SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
March 15, 1996 (February 29, 1996)
________________________________________________
Date of report (Date of earliest event reported)
Hexcel Corporation
______________________________________________________
(Exact Name of Registrant as Specified in Charter)
Delaware 1-8472 94-1109521
______________ _____________________ __________________
(State of (Commission File No.) (IRS Employer
Incorporation) Identification No.)
5794 West Las Positas Boulevard
Pleasanton, California 94588-8781
_________________________________________________________
(Address of Principal Executive Offices and Zip Code)
(510) 847-9500
____________________________________________________
(Registrant's telephone number, including area code)
N/A
_________________________________________________________
(Former Name or Former Address, if Changed Since Last Report)
Item 2. Acquisition or Disposition of Assets.
On February 29, 1996, Hexcel Corporation, a
Delaware corporation ("Hexcel"), consummated the
acquisition (the "Acquisition") of the worldwide
Composites Division of Ciba-Geigy Limited, a Swiss
corporation ("Ciba"), and Ciba-Geigy Corporation, a New
York corporation ("CGC"), which included Ciba's and CGC's
composites, structures and interiors, fabrics, laminates,
prepregs, adhesive films, honeycomb core, sandwich panels
and fabricated components businesses (the "Ciba
Composites Business"). The Acquisition was consummated
pursuant to the terms and conditions of a Strategic
Alliance Agreement dated as of September 29, 1995 among
Ciba, CGC and Hexcel, as amended (the "Strategic Alliance
Agreement"). Under the Strategic Alliance Agreement,
Hexcel acquired the assets (including the capital stock
of certain of Ciba's non-U.S. subsidiaries) and
liabilities of the Ciba Composites Business other than
certain excluded assets and liabilities, in exchange for
(i) 18,021,748 newly issued shares of Hexcel's common
stock, (ii) $25 million in cash and (iii) undertakings by
Hexcel to deliver to Ciba and/or one or more of its
subsidiaries, following completion of certain post-
closing adjustment procedures contemplated by the
Strategic Alliance Agreement, (x) senior subordinated
notes to be issued pursuant to an Indenture dated as of
February 29, 1996 between Hexcel and First Trust of
California, National Association, as trustee, as the same
may be amended from time to time (the "Indenture"), in an
aggregate principal amount of approximately $43 million,
subject to certain adjustments contemplated by the
Strategic Alliance Agreement and (y) senior demand notes
in a principal amount equal to the cash on hand at
certain of Ciba's former non-U.S. subsidiaries. Pursuant
to the Strategic Alliance Agreement, certain assets of
the Ciba Composites Business, including the capital stock
of Ciba's Austrian subsidiary, Danutec Werkstoff G.m.b.H.
(or its successor), and certain assets of Ciba affiliates
that will continue to act as distributors for the Ciba
Composites Business following the Acquisition, will be
acquired from time to time prior to the first anniversary
of the closing date of the Acquisition.
The amount of consideration paid by Hexcel in
the Acquisition was established through arm's length
negotiations among Ciba, CGC and Hexcel.
The cash component of the Acquisition
consideration was funded with borrowings under a new
three-year $175 million credit facility under a Credit
Agreement dated as of February 29, 1996 among Hexcel and
certain of its subsidiaries, as borrowers, Citibank,
N.A., as administrative agent ("Citibank"), Citibank
International plc, as European administrative agent, the
lending institutions and issuing banks party thereto, and
Credit Suisse, as syndication agent (the "Credit
Agreement"). Borrowings under the Credit Agreement
accrue interest at a rate per annum equal to, at the
option of the borrower, (i) the applicable London
interbank rate plus 0.40% or (ii) Citibank's base rate.
The borrowers' obligations under the Credit Agreement are
secured by a pledge of stock of certain of Hexcel's
subsidiaries and are also guaranteed by Hexcel and
certain of its subsidiaries.
A portion of the assets acquired by Hexcel in
the Acquisition constitute plant, equipment and other
physical property which was used in the ongoing operation
of the Ciba Composites Business. Although most of such
assets are expected to be used for similar purposes by
Hexcel, Hexcel intends to eliminate excess capacity and
consolidate redundant activities in connection with the
integration of the Ciba Composites Business with Hexcel's
other businesses. In this regard, Hexcel has announced
its plans for a two-year phasedown of operations at the
Anaheim, California facility acquired as part of the Ciba
Composites Business. However, because the nature, timing
and extent of Hexcel's consolidation activities are
dependent, in part, on factors which are not within
Hexcel's control and because final decisions have not yet
been made with respect to many of such consolidation
activities, it is not possible at this time to identify
with particularity Hexcel's intended uses for the other
plant, equipment and other physical property acquired as
part of the Ciba Composites Business.
The foregoing descriptions of the Acquisition
and the Credit Agreement are qualified in their entirety
by reference to (i) the Strategic Alliance Agreement,
which is included as Exhibit 2.1 to this Current Report
on Form 8-K, (ii) the Amendment dated as of December 12,
1995 to the Strategic Alliance Agreement, which is
included as Exhibit 2.1(a) to this Current Report on Form
8-K, (iii) the Letter Agreement dated as of February 28,
1996 among Ciba, CGC and Hexcel, which is included as
Exhibit 2.1(b) to this Current Report on Form 8-K, (iv)
the Distribution Agreement dated as of February 29, 1996
among Hexcel, Brochier S.A., Composite Materials Limited,
Salver S.r.l. and Ciba, which is included as Exhibit
2.1(c) to this Current Report on Form 8-K, (v) the
Indenture, which is included as Exhibit 4.1 to this
Current Report on Form 8-K and (vii) the Credit
Agreement, which is included as Exhibit 99.1 to this
Current Report on Form 8-K.
Item 7. Financial Statements, Pro Forma
Financial Information and Exhibits.
(a) Financial Statements of Business Acquired.
Hexcel has determined that it is impracticable at this
time to provide the required financial statements of the Ciba
Composites Business. Hexcel will file such financial statements
as an amendment to this Current Report on Form 8-K as soon as
practicable but in no event later than May 14, 1996.
(b) Pro Forma Financial Information.
Hexcel has determined that it is impracticable
at this time to provide the required pro forma financial
information with respect to the Acquisition. Hexcel will
file such pro forma financial information as an amendment
to this Current Report on Form 8-K as soon as practicable
but in no event later than May 14, 1996.
(c) Exhibits.
Exhibit No. Description
2.1 Strategic Alliance Agreement dated as
of September 29, 1995 among Ciba, CGC
and Hexcel (filed as Exhibit 10.1 to
Hexcel's Current Report on Form 8-K
dated October 12, 1995 and
incorporated herein by reference).
2.1(a) Amendment dated as of December 12, 1995 to
the Strategic Alliance Agreement dated as
of September 29, 1995 among Ciba, CGC and
Hexcel.
2.1(b) Letter Agreement dated as of February 28,
1996 among Ciba, CGC and Hexcel.
2.1(c) Distribution Agreement dated as of
February 29, 1996 among Hexcel, Brochier
S.A., Composite Materials Limited, Salver
S.r.l. and Ciba.
4.1 Indenture dated as of February 29,
1996 between Hexcel and First Trust
of California, National Association,
as trustee.
99.1 Credit Agreement dated as of February
29, 1996 among Hexcel and certain
subsidiaries of Hexcel, as borrowers,
the lending institutions and issuing
banks party thereto, Citibank, N.A.,
as administrative agent, and Credit
Suisse, as syndication agent.
SIGNATURES
Pursuant to the requirements of the Securities
Exchange Act of 1934, the Registrant has duly caused this
report to be signed on its behalf by the undersigned
hereunto duly authorized.
Dated: March 15, 1996
HEXCEL CORPORATION
By: /s/ RODNEY P. JENKS, JR.
Name: Rodney P. Jenks, Jr.
Title: Vice President, General
Counsel and Secretary
EXHIBIT INDEX
Exhibit Description
2.1 Strategic Alliance Agreement dated as of
September 29, 1995 among Ciba, CGC and
Hexcel (filed as Exhibit 10.1 to Hexcel's
Current Report on Form 8-K dated October
12, 1995 and incorporated herein by
reference).
2.1(a) Amendment dated as of December 12,
1995 to the Strategic Alliance
Agreement dated as of September 29,
1995 among Ciba, CGC and Hexcel.
2.1(b) Letter Agreement dated as of February
28, 1996 among Ciba, CGC and Hexcel.
2.1(c) Distribution Agreement dated as of
February 29, 1996 among Hexcel,
Brochier S.A., Composite Materials
Limited, Salver S.r.l. and Ciba.
4.1 Indenture dated as of February 29, 1996,
between Hexcel and First Trust of
California, National Association, as
trustee.
99.1 Credit Agreement dated as of February 29,
1996 among Hexcel and certain subsidiaries
of Hexcel, as borrowers, the lending
institutions and issuing banks party
thereto, Citibank, N.A., as administrative
agent, and Credit Suisse, as syndication
agent.
EXHIBIT NO. 2.1(a)
AMENDMENT dated as of December 12, 1995, to the
STRATEGIC ALLIANCE AGREEMENT dated as of September 29,
1995 (the "Agreement"), among CIBA-GEIGY LIMITED, a Swiss
corporation ("Ciba"), CIBA-GEIGY CORPORATION, a New York
corporation and a wholly-owned subsidiary of Ciba
("CGC"), and HEXCEL CORPORATION, a Delaware corporation
("Hexcel").
WHEREAS Hexcel, Ciba and CGC desire to amend the
Agreement in certain respects; and
WHEREAS the capitalized terms used but not defined
herein shall have the meanings specified in the
Agreement.
NOW, THEREFORE, in consideration of the mutual
covenants and undertakings contained herein and in the
Agreement and for other good and valuable consideration,
the receipt and sufficiency of which is hereby
acknowledged, the parties hereto hereby agree as follows:
Section 1. Amendments. (a) The introductory clause
to Section 2.04(d) of the Agreement shall be deleted and
replaced by the following:
"The principal amount of the Subordinated Debt shall
be $43,029,000 adjusted as follows:"
(b) The definition of Ancillary Agreements in
Appendix A shall be deleted and replaced with the
following:
""Ancillary Agreements" shall mean the Governance
Agreement, the Trademark License Agreement, the
Registration Rights Agreement, the Transitional
Services Agreements, the Employment Matters
Agreement, the UK Employment Matters Agreement, the
Subordinated Debt, the Indenture, the Distribution
Agreement, the Assignment and Assumption Agreement,
the Supply and Tolling Agreements and the UK
Agreements."
(c) Section 1.03(b)(v) of the Agreement shall be
deleted and replaced with the following:
"(v) any obligation or liability relating to or
arising out of an event occurring prior to the
Closing Date for which Ciba or any of its
Subsidiaries has coverage under AAU lead policy #001
SP-6127 or its predecessor policies."
Section 2. Effect. This Amendment shall be deemed
for all purposes to be a part of the Agreement, which
shall remain in full force and effect in all respects as
amended hereby.
IN WITNESS WHEREOF, Ciba, CGC and Hexcel have each
caused this Amendment to be signed by their respective
officers thereunto duly authorized, all as of the date
first written above.
CIBA-GEIGY LIMITED,
by /s/ JOHN M.D. CHEESMOND
Name: John M.D. Cheesmond
Title: Senior Vice President
-- Finance and Information Services
CIBA-GEIGY LIMITED,
by /s/ J. MANSER
Name: J. Manser
Title: Group Treasurer
CIBA-GEIGY CORPORATION,
by /s/ STANLEY SHERMAN
Name: Stanley Sherman
Title: Vice President --
Finance and Information Services
HEXCEL CORPORATION
by /s/ JOHN J. LEE
Name: John J. Lee
Title: Chief Executive Officer
EXHIBIT NO. 2.1(b)
HEXCEL CORPORATION
5794 West Las Positas Boulevard
Pleasanton, CA 94588
February 28, 1996
Strategic Alliance Agreement
Dear Sirs:
We refer to the Strategic Alliance Agreement
dated as of September 29, 1995 and amended as of
December 12, 1995 (the "Agreement"), among us and each of
you. As a result of certain ambiguities and
inconsistencies in the Agreement and the desire of the
parties to clarify such ambiguities and inconsistencies
and amend certain provisions of the Agreement, the
parties to the Agreement wish to set forth herein their
agreement with respect to such matters. Capitalized
terms used in this Letter Agreement but not defined shall
have the meanings set forth in the Agreement.
1. Danutec
Ciba will not deliver the Danutec Equity to
Hexcel at Closing. In addition, certain information with
respect to the Deferred Assets will not be available as
of the Closing Date. Accordingly, Section 2.04(e) of the
Agreement shall be amended by deleting all language in
the first sentence following the words "provided,
further" and replacing such language with the following:
"that no amounts relating to Danutec or the
Deferred Assets shall be included in any
component of Closing Working Capital of the
Transferred Business, Working Capital of the
Transferred Business on the date of the Balance
Sheet, the Ciba Closing Items and, if
applicable, any corresponding amounts on the
Balance Sheet."
In addition, Section 2.05(d) of the Agreement
shall be deleted and replaced in its entirety with the
following:
"(d) At the Danutec Closing, Hexcel shall
deliver to Ciba or its designated Subsidiary or
Subsidiaries (i) an undertaking to deliver
(A) a principal amount of Subordinated Debt
(which Subordinated Debt shall bear interest
from the date of the Danutec Closing and be
allocated in accordance with Section 1.04)
equal to the Danutec Adjusted Amount (as
defined below) and (B) a senior demand note of
Hexcel containing mutually acceptable terms in
a principal amount equal to the amount of
Danutec Closing Cash (as defined below), in
each case, within two business days after the
Danutec Statement becomes final and binding on
the parties and (ii) such other documents, in
form and substance reasonably satisfactory to
Ciba and its counsel, as Ciba and its counsel
shall reasonably request to demonstrate
satisfaction or waiver of the conditions and
compliance with the agreements set forth
herein."
At the Danutec Closing, Hexcel and Ciba shall
also enter into an agreement substantially in the form
attached hereto as Exhibit A.
New Sections 2.05(g), (h), (i) and (j) shall be
added to the Agreement as follows:
"(g) (i) Within 75 days after the Danutec
Closing Date, Ciba shall prepare and deliver to Hexcel a
statement (the "Danutec Statement"), certified by a duly
authorized signatory of Ciba, setting forth (A) the
components of Danutec Working Capital (as defined below)
immediately prior to the Danutec Closing ("Danutec
Closing Working Capital"), in no less detail than, and
determined in accordance with, U.S. GAAP applied on a
basis consistent with the balance sheet of Danutec (the
"Danutec Balance Sheet") reflected in the Balance Sheet,
(B) the amounts as of the Danutec Closing corresponding
to individual items attributable to Danutec, if any, set
forth on Schedule 2.04(a1), increases after June 30, 1995
in reserves attributable to Danutec relating to Assumed
Tax Liabilities (other than deferred Tax liabilities) for
taxable periods ending on or prior to December 31, 1994
and any other reserves attributable to Danutec, if any,
for non-operating liabilities that would represent future
cash expenses of the Transferred Business all as would be
properly reflected on the balance sheet of Danutec as of
the Danutec Closing Date prepared in accordance with U.S.
GAAP on a basis consistent with the Balance Sheet (the
"Danutec Closing Items"), (C) the amount of Taxes, if
any, attributable to Danutec paid by Ciba or its
Subsidiaries, including Danutec, prior to the Danutec
Closing that, absent the Danutec Closing, would have been
payable after the Danutec Closing ("Prepaid Danutec
Taxes") and (D) a certificate of Ciba that the Danutec
Statement has been prepared in compliance with the
requirements of this Section 2.05.
(ii) Hexcel shall cooperate with Ciba in
connection with the preparation of the Danutec Statement
and shall, to the extent reasonably requested by Ciba,
provide Ciba and its advisors access during normal
business hours to the personnel, properties, books and
records of Hexcel and its Subsidiaries relating to
Danutec for such purpose; provided, however, that Ciba
shall have the primary responsibility and authority for
preparing the Danutec Statement.
(iii) During the thirty-day period following
Hexcel's receipt of the Danutec Statement, Hexcel and its
advisors shall be permitted to review the working papers
relating to the Danutec Statement. Ciba shall and shall
cause its advisors to cooperate with Hexcel and Hexcel's
advisors in connection with such review. The Danutec
Statement shall become final and binding upon the parties
on the thirtieth day following delivery thereof, unless
Hexcel gives written notice of its disagreement with the
Danutec Statement ("Danutec Notice of Disagreement") to
Ciba prior to such date. Any Danutec Notice of
Disagreement shall (A) specify in reasonable detail the
nature of any disagreement so asserted and (B) be
accompanied by a certificate of Hexcel that it has
complied with the covenants set forth in this
Section 2.05. If a Danutec Notice of Disagreement is
received by Ciba in a timely manner, then the Danutec
Statement (as revised in accordance with clause (I) or
(II) below) shall become final and binding upon Ciba and
Hexcel on the earlier of (I) the date Ciba and Hexcel
resolve in writing any differences they have with respect
to the matters specified in the Danutec Notice of
Disagreement or (II) the date any disputed matters are
finally resolved in writing by the Accounting Firm.
(h) During the thirty-day period following the
delivery of a Danutec Notice of Disagreement, Hexcel and
Ciba shall seek in good faith to resolve in writing any
differences which they may have with respect to the
matters specified in such Danutec Notice of Disagreement.
During such period each of Hexcel or Ciba, as the case
may be, and its advisors shall have access to the working
papers of the other party and its advisors prepared in
connection with such Danutec Notice of Disagreement. At
the end of such thirty-day period, Hexcel and Ciba shall
each submit, in the form of a written brief, any and all
matters that remain in dispute and that were properly
included in such Danutec Notice of Disagreement to the
Accounting Firm for final and binding review and
resolution. Hexcel and Ciba shall jointly request that
the arbitration be conducted in accordance with
procedures established by the Accounting Firm. Judgment
may be entered upon the determination of the Accounting
Firm in any court having jurisdiction over the party
against which such determination is to be enforced. The
cost of such review and resolution (including the fees
and expenses of the Accounting Firm and reasonable
attorneys' and accountants' fees and expenses of the
parties) pursuant to this Section 2.05 shall be borne by
Hexcel and Ciba in inverse proportion as they may prevail
on the merits of the matters resolved by the Accounting
Firm, which proportionate allocations shall also be
determined by the Accounting Firm at the time the
determination of the Accounting Firm is rendered thereon.
Except as set forth in the immediately preceding
sentence, the parties shall bear their own costs and
expenses (including attorneys' and accountants' fees and
expenses) in connection with the matters contemplated by
this Section 2.05.
(i) The principal amount of the Subordinated
Debt to be delivered in respect of the Danutec Equity
shall be $9 million, adjusted as follows (as so adjusted,
the "Danutec Adjusted Amount"):
(1) the principal amount shall be decreased or
increased, as the case may be, by an amount equal to
the amount by which the Danutec Closing Working
Capital exceeds or is less than, as the case may be,
the Danutec Working Capital reflected on the Danutec
Balance Sheet;
(2) the principal amount shall be decreased by
an amount equal to the amount of cash, cash
equivalents and marketable securities constituting a
component of Danutec Closing Working Capital
("Danutec Closing Cash");
(3) to the extent any amount of Prepaid Danutec
Taxes is not included as a Danutec Current Asset (as
defined below) in the calculation of Danutec Closing
Working Capital, the principal amount shall be
increased by an amount equal to the amount of such
Prepaid Taxes; and
(4) the principal amount shall be decreased by
the amount, if any, by which the total amount of
Danutec Closing Items exceeds $7,649,000 or shall be
increased by the amount, if any, by which $7,649,000
exceeds such amount.
(j) The term "Danutec Working Capital" shall
mean Danutec Current Assets minus Danutec Current
Liabilities. The terms "Danutec Current Assets" and
"Danutec Current Liabilities" shall mean the current
assets and current liabilities (other than any such
assets or liabilities that are included in the adjustment
required by Section 2.05(i)(4)), respectively, of
Danutec, calculated in accordance with U.S. GAAP on a
basis consistent with the Balance Sheet; provided,
(i) Danutec Current Assets and Danutec Current
Liabilities shall not include any amounts in respect of
Excluded Tax Assets or Excluded Tax Liabilities and
(ii) for purposes of calculating Danutec Working Capital
as of the date of the Balance Sheet, cash, cash
equivalents and marketable securities shall be deemed to
be zero. The parties agree that the adjustment regarding
Danutec Working Capital contemplated by this Section 2.05
is intended to show the change in Danutec Working Capital
from the date of the Balance Sheet to the Danutec Closing
Date, and such change can only be measured if each
calculation is done in the same way, using the same
methods, at both dates. Accordingly, in the event that
the resolution of any dispute relating to the calculation
of any component of Danutec Working Capital as of any
particular date results in a change in the way that, or
the method by which, such component of Danutec Working
Capital was calculated, a corresponding change shall be
made in the way that, or the method by which, such
component of Danutec Working Capital is calculated as of
any other date."
Section 2.04(d)(vii) of the Agreement shall be
amended by deleting the figure "$83,029,000" on the last
two lines of that Section and replacing it in both
instances with "$90,678,000."
2. UK Arrangements
The definition of "Contributed Shares" shall be
deleted and replaced with the following:
""Contributed Shares" shall mean (i) all
capital stock of or other equity interests in
any Divested Subsidiary (other than CML) owned
directly or indirectly by Ciba and (ii) all
U.S. dollar denominated bearer shares of CML."
3. Salver
On the Closing Date, Hexcel and Ciba shall
enter into an indemnification agreement in the form
attached hereto as Exhibit B.
4. Closing Procedures
Hexcel and Ciba agree that the following
procedures shall apply with respect to companies that, in
accordance with their regular monthly closing procedures,
close their books on a date other than the Closing
Date: (i) for companies closing their books on
February 23, 1996, adjustments shall be made to reflect
changes in Working Capital from February 23, 1996 through
the Closing Date and (ii) for all companies that do not
close their books on the Closing Date, adjustments will
be made to reflect large identifiable items,
extraordinary items and items outside the ordinary course
between the Closing Date and the date such company's
books are closed. Following the Closing, Hexcel shall
cause any Subsidiary that closes its books after the
Closing to operate its business in the ordinary course
and take no extraordinary action (including, without
limitation, payment of any dividend or other distribution
or incurrence of debt) that would affect the calculation
of the amount of Subordinated Debt pursuant to
Section 2.04 of the Agreement until such Subsidiary
thereafter closes its books in accordance with its
regular monthly closing procedures.
5. Intercompany Loans; CML Closing Cash
The parties acknowledge and agree that the
amount of intercompany indebtedness to be transferred by
Ciba to Hexcel and its Subsidiaries pursuant to the
Agreement shall be (i) French Franc 32,000,000 in respect
of Brochier and (ii) Italian Lira 7,100,000,000 (interest
bearing) in respect of Salver and Italian
Lira 3,390,000,000 (non-interest bearing) in respect of
Salver. In addition, the parties agree that the Ciba
Composites Business' intercompany payables/receivables
shall, following the Closing, be treated as trade
payables/receivables. Notwithstanding the provisions of
Section 2.04, in place of Subordinated Debt issuable
under such Section 2.04 that is attributable to cash of
CML on the Closing Date, Hexcel shall issue to Ciba or
its designated Subsidiary concurrently with the issuance
of the Subordinated Debt pursuant to Section 2.04 a
senior demand note of Hexcel containing mutually
acceptable terms in an aggregate principal amount equal
to the amount of cash of CML on the Closing Date. Hexcel
acknowledges that Ciba currently intends to demand
payment of such senior demand note (as well as the senior
demand note referred to in paragraph 1 above) shortly
after its receipt thereof.
6. Deferred Assets
Hexcel acknowledges that the Distributors (as
defined in the Distribution Agreement dated the Closing
Date) will not close their books on the Closing Date and
agrees with Ciba and CGC that, as a result,
Section 2.04(d)(iv) of the Agreement shall be deleted and
replaced with the following:
"(iv) the principal amount shall be
decreased by the net book value of the Deferred
Assets that are set forth on the Balance Sheet
plus $457,000."
In addition, the words "Closing Date" in
clause (E) of the first sentence of Section 2.04(a)(i)
shall be deleted and replaced with the words "date of the
Balance Sheet."
7. Third Party Consents
Notwithstanding anything in any other document
to the contrary, as between the parties hereto the
principles set forth in the Agreement and the Ancillary
Agreements as to the allocation of particular assets
among Acquired Assets and Excluded Assets and particular
liabilities among Assumed Liabilities and Excluded
Liabilities shall, pursuant to their terms, govern and
supersede any and all inconsistent provisions contained
in any and all consents (and/or assignment and assumption
agreements entered into at the request of a third party)
obtained by Ciba or Hexcel in connection with the
transactions contemplated by the Agreement and the
Ancillary Agreements. In addition, certain consents to
assignment of agreements of the Transferred Business
obtained from third parties oblige Ciba or its
Subsidiaries to guarantee performance or payment under
such agreements or do not contain releases of Ciba as a
primary or other obligor under such agreements. Hexcel
agrees that any amounts payable by Ciba or any of its
Subsidiaries under such agreements, solely to the extent such
amounts constitute Assumed Liabilities, shall be subject
to indemnification pursuant to Section 7.02 of the
Agreement, regardless of whether Ciba or such Subsidiary
is primarily liable or otherwise. Ciba agrees that any
amounts payable by Hexcel or any of its Subsidiaries
under such agreements, solely to the extent such amounts
constitute Excluded Liabilities, shall be subject to
indemnification pursuant to Section 7.01 of the
Agreement, regardless of whether Hexcel or such
Subsidiary is primarily liable or otherwise.
8. Security Arrangements
Within 45 days after the Closing, Hexcel shall
enter into the ancillary agreements in form and substance
satisfactory to the Department of Defense and reasonably
satisfactory to Ciba as provided in the Special Security
Agreement to be dated as of March 15, 1996, by and among
Ciba, CGC, Hexcel and Hexcel Pottsville Corporation,
including without limitation the Implementation
Procedures, the Administrative Agreement and the other
documents referred to therein.
9. Global Materials Supply Agreement
The parties acknowledge that they may not agree
upon mutually acceptable terms of a Global Materials
Supply Agreement prior to the Closing as contemplated by
Section 4.12 of the Agreement. The parties agree to
negotiate in good faith, agree upon such mutually
acceptable terms and execute an agreement in
substantially the form attached hereto as Exhibit C
within 30 days after the Closing. The parties agree that
the initial interest rate on the Subordinated Debt has
been fixed at 7.5% per annum rather than the 9% rate set
forth in Exhibit B to the Agreement. In the event the
parties fail to execute and deliver such agreement within
such period, the parties shall amend the Indenture to
provide that the Subordinated Debt shall initially bear
interest at a rate per annum of 9%, which rate shall be
effective retroactively to the Closing Date.
10. Miscellaneous
The provisions of this Letter Agreement shall
be governed by and construed in accordance with the laws
of the State of Delaware, regardless of the laws that
might otherwise govern under applicable principles of
conflicts of law. Except as expressly set forth herein,
the Agreement shall remain in full force and effect in
accordance with its terms.
If the foregoing is in accordance with your
understanding of our agreement, please sign and return to
us, whereupon this letter and your acceptance shall
represent a binding agreement among Hexcel, Ciba and CGC.
Very truly yours,
HEXCEL CORPORATION
by /s/ STEPHEN C. FORSYTH
Name: Stephen C. Forsyth
Title: Vice President
The foregoing is hereby confirmed
and accepted as of the date first
above written.
CIBA-GEIGY LIMITED
by /s/ JOHN M.D. CHEESMOND
Name: John M.D. Cheesmond
Title: Head of Regional Finance and Control
by /s/ PETER RUDOLF
Name: Peter Rudolf
Title: Senior Division Counsel
CIBA-GEIGY CORPORATION
by /s/ STANLEY SHERMAN
Name: Stanely Sherman
Title: Vice President, Finance and Information Services
EXHIBIT 2.1(c)
DISTRIBUTION AGREEMENT (this
"Agreement"), dated as of February 29,
1996, among HEXCEL CORPORATION, a Delaware
corporation ("Hexcel"), BROCHIER S.A., a
French corporation ("Brochier"), COMPOSITE
MATERIALS LIMITED, a United Kingdom
corporation ("CML"), SALVER, S.r.l., an
Italian corporation ("Salver", together
with Brochier and CML, the "Hexcel
Subsidiaries"), and CIBA-GEIGY LIMITED, a
Swiss corporation ("Ciba").
WHEREAS, Ciba and Hexcel have entered into a
Strategic Alliance Agreement dated as of September 29,
1995 and amended as of December 12, 1995 (the "SAA")
pursuant to which Ciba and Hexcel have agreed to combine
the Transferred Business with Hexcel's business;
WHEREAS, in connection with the SAA, Hexcel and
the Hexcel Subsidiaries desire Ciba to continue to have
Ciba's affiliates act as distributors for products of the
Transferred Business in the territories referred to on
Schedule 1 attached hereto (the "Distributors");
WHEREAS, Hexcel and Ciba are interested in a
smooth transition of the Transferred Business to Hexcel;
and
WHEREAS, Ciba is willing to have its affiliates
provide their services as Distributors for products of
the Transferred Business.
NOW, THEREFORE, in consideration of the
undertakings set forth herein and for other good and
valuable consideration the receipt and sufficiency of
which are hereby acknowledged, the parties hereto have
therefore agreed as follows:
SECTION 1. Terms not specifically defined
herein shall have the meaning assigned to them in the
SAA.
SECTION 2. (a) Ciba commits that the
affiliates of Ciba listed in Schedule 1 hereto shall
continue to act as Distributors for products of the
Transferred Business in the countries listed in
Schedule 1 under the terms and conditions at which they
have cooperated with the Transferred Business during the
six-month period immediately prior to the date of this
agreement. The Distributors shall act as independent
distributors and are in no way authorized to bind Hexcel
and/or the Hexcel Subsidiaries.
(b) In the event that Danutec is acquired by
Hexcel and/or the Hexcel Subsidiaries on or before
March 31, 1997, Danutec shall be deemed to be a Hexcel
Subsidiary under this Agreement entitled to all the
rights and benefits thereof.
(c) A list of the employees currently working
for each Distributor in connection with the Transferred
Business (the "Employees") is attached hereto as
Schedule 2.
SECTION 3. (a) The Distributors shall use all
commercially reasonable efforts to continue to solicit
and serve customers for the Transferred Business by using
the assets and employees dedicated to the Transferred
Business at present and reflected in the Balance Sheet.
The Distributors shall also provide the necessary
administrative support and related services.
(b) Hexcel and the Hexcel Subsidiaries shall
use all commercially reasonable efforts to continue to
supply the Distributors.
(c) The Distributors shall report to Hexcel
and the appropriate Hexcel Subsidiaries via the existing
regional management structure of the Transferred
Business.
(d) The Distributors shall continue to provide
budgets, latest estimates, monthly reports and one-year
plans in the format and in accordance with the timetable
to be agreed with Hexcel and the Hexcel Subsidiaries.
(e) The Distributors shall continue monthly
third party sales reporting as per the Ciba Form G02
currently used, including the end of month Ciba "quick"
report.
(f) The Distributors shall visit customers
regularly and provide to Hexcel and the appropriate
Hexcel Subsidiaries reports on key customers and assist
the personnel of Hexcel and the Hexcel Subsidiaries in
obtaining access to customers.
(g) The Distributors shall manage local
stocks, consignment stocks and the assets of the
Transferred Business in the countries listed on
Schedule I hereto in the best interest of Hexcel and the
Hexcel Subsidiaries in accordance with the direction of
the regional management structure of the transferred
business.
SECTION 4. Hexcel and all the Hexcel
Subsidiaries shall provide the Distributors with price
lists for the products of the transferred business to be
handled by the Distributors and use their commercially
reasonable efforts to fulfill all orders of the
Distributors as requested in accordance with the terms
hereof and at list prices. Hexcel, the Hexcel
Subsidiaries and the regional management structure of the
transferred business together with the Distributors shall
coordinate dealing with key customers in the countries.
SECTION 5. (a) The Distributors shall not,
without the prior agreement of Hexcel, which agreement
shall not be unreasonably withheld, transfer key
employees providing services to the Transferred Business
hereunder to other businesses of the Ciba Group.
(b) The Hexcel Subsidiaries shall ship orders
either to the Distributors or, if requested, directly to
customers.
(c) The Distributors shall not provide
customers with warranties exceeding the warranties
provided to the Distributors by Hexcel and the Hexcel
Subsidiaries.
SECTION 6. (a) This Agreement shall become
effective on the Closing Date and shall remain in effect
until March 1, 1997. Hexcel shall be entitled to give
two (2) months written notice effective at the end of any
calendar month to terminate this Agreement for one or
more specified Distributors at any time.
(b) Upon termination of this Agreement in its
entirety or for specified Distributors, Hexcel and/or the
Hexcel Subsidiaries shall acquire the Inventory and Fixed
Assets of the Distributor(s) which constitute the
Deferred Assets. Such Inventory shall consist of those
products of the Transferred Business purchased from
Hexcel and the Hexcel Subsidiaries by the Distributor(s).
Such Inventory shall be acquired by Hexcel or the Hexcel
Subsidiaries at a purchase price equal to the landed cost
of such Inventory to the Distributor(s). Fixed Assets
shall consist of the assets listed on Schedule 3 hereto.
Such fixed assets shall be transferred to Hexcel and the
Hexcel Subsidiaries free of charge, with the exception of
the fixed assets in South Africa for which Hexcel shall
pay Ciba (i) U.S.$318,477, plus (ii) U.S.$139,053 if the
Spartan plan land and building are also transferred.
(c) Upon termination of this Agreement in its
entirety or with respect to one or more specified
Distributors, Hexcel and/or the Hexcel Subsidiaries shall
have the right to offer and where by law obliged to
actually offer employment to the relevant Employees.
Employment shall be offered on compensation and benefit
terms that are reasonably competitive considering the
country involved, then prevailing economic conditions,
the industry sector in which the relevant Employees are
engaged and the relevant Employees' skills and
experience. Prior to employment by Hexcel or any of the
Hexcel Subsidiaries, the Distributor(s) (or if
applicable, Ciba) shall fully vest the relevant Employees
in any pension scheme or other employee benefit program
in which such Employees have participated and
Distributor(s) (of if applicable, Ciba) shall retain any
and all liabilities with respect thereto. If Hexcel and
the Hexcel Subsidiaries fail to offer employment to one
or more of such Employees and within three (3) months
thereafter the applicable Distributor(s) terminates the
employment of any such Employee, then Hexcel shall
contribute an amount up to the amount specified by law
and if no such law exists an amount to be agreed to by
the parties, which amount shall not exceed one year's
total compensation for the respective Employee(s).
Except as otherwise provided in this Agreement, Hexcel
shall treat all Employees no less favorably than other
employees of Hexcel who are employed in comparable
positions in comparable locations.
(d) Hexcel and the Hexcel Subsidiaries shall
be free to negotiate either an extension of this
Agreement or one or more new agreements with any of the
Distributors.
(e) Sections 8.07 and 8.08 of the SAA are
incorporated by reference herein and shall be deemed to
constitute part of this Agreement.
SECTION 7. Notices. All notices and other
communications hereunder shall be in writing (including
fax) and shall be sent, delivered or mailed, addressed,
or faxed:
(a) if to Hexcel or any of the Hexcel
Subsidiaries, to:
Hexcel Corporation
5794 West Las Positas Boulevard
Pleasanton,CA 94588
(T) (510) 847-9500 (x4257)
(F) (510) 847-9727
Attention of Stephen C. Forsyth
and
Mr. Rodney P. Jenks
(T) 510 847-9500 (x4383)
(F) 510 734-8611
(b) if to Ciba to:
Ciba-Geigy Limited
CH 4002
Basle, Switzerland
(T) (41) 61 696-5107
(F) (41) 61 696-4677
Attention of Dr. Peter Rudolf
Each such notice, request or other communication shall be
given (i) by hand delivery, (ii) by nationally recognized
courier service or (iii) by fax, receipt confirmed. Each
such notice, request or communication shall be effective
(A) if delivered by hand or by nationally recognized
courier service, when delivered at the address specified
in this Section 7 (or in accordance with the latest
unrevoked written direction from the party to whom such
notice is delivered) and (B) if given by fax, when such
fax is transmitted to the fax number specified in this
Section 7 (or in accordance with the latest unrevoked
written direction from the party to whom such notice is
transmitted), and the appropriate confirmation is
received.
IN WITNESS WHEREOF, the parties hereto have
caused this Distribution Agreement to be duly executed by
their respective authorized officers as of the date first
above written.
HEXCEL CORPORATION,
by /s/ JOHN M.D. CHEESMOND
Name: John M.D. Cheesmond
Title: Head of Regional Finance
and Control
CIBA-GEIGY LIMITED,
by /s/ PETER RUDOLF
Name: Peter Rudolf
Title: Senior Division Counsel
COMPOSITE MATERIALS LIMITED,
by /s/ PETER YOUNG
Name: Peter Young
Title: Authorized Representative
BROCHIER, S.A.,
by /s/ JEAN YVES LE CAM
Name: Jean Yves Le Cam
Title: President du Directione
SALVER, S.r.l.,
by /s/ LUCIANO ACQUARONE
Name: Luciano Acquarone
Title: Managing Director
EXHIBIT NO. 4.1
INDENTURE dated as of February 29, 1996,
between HEXCEL CORPORATION, a Delaware
corporation (the "Company"), and FIRST TRUST OF
CALIFORNIA, NATIONAL ASSOCIATION, a national
banking association (the "Trustee").
WHEREAS, the Company is party to the Strategic
Alliance Agreement (as defined herein), which provides that
the Company shall issue Securities (as defined herein)
(i) pursuant to Section 2.04(g) of the Strategic Alliance
Agreement, on the date provided therein, to bear interest
from the Closing (as defined in the Strategic Alliance
Agreement), (ii) pursuant to Section 2.03(a) of the
Strategic Alliance Agreement, on the Deferred Consideration
Payment Date (as defined in the Strategic Alliance
Agreement), to bear interest from such date and
(iii) pursuant to Section 2.05(d) of the Strategic Alliance
Agreement, on the date of the Danutec Closing (as defined in
the Strategic Alliance Agreement), to bear interest from
such date;
NOW, THEREFORE, each party agrees as follows
for the benefit of the other party and for the equal and
ratable benefit of the Holders of the Company's Increasing
Rate Senior Subordinated Notes due 2003 (the "Securities"):
ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. Definitions.
"Acquisition" means the acquisition by the
Company and certain Subsidiaries of the global composites
business of Ciba-Geigy Limited.
"Additional Assets" means any (i) property or
assets (other than Indebtedness and Capital Stock) to be
used by the Company or a Subsidiary; (ii) Capital Stock of a
Person that becomes a Subsidiary as a result of the
acquisition of such Capital Stock by the Company or another
Subsidiary; or (iii) Capital Stock constituting a minority
interest in any Person that at such time is a Subsidiary.
"Affiliate" of any specified Person means
(i) any other Person, directly or indirectly, controlling or
controlled by or under direct or indirect common control
with such specified Person or (ii) any other Person who is a
director or officer (A) of such specified Person, (B) of any
Subsidiary of such specified Person or (C) of any Person
described in clause (i). For the purposes of this
definition, "control" when used with respect to any Person
means the power to direct the management and policies of
such Person, directly or indirectly, whether through the
ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings
correlative to the foregoing. For purposes of Sections 4.06
and 4.07 only, "Affiliate" shall also mean any beneficial
owner of shares representing 5% or more of the total voting
power of the Voting Stock (on a fully diluted basis) of the
Company or of rights or warrants to purchase such Voting
Stock (whether or not currently exercisable) and any Person
who would be an Affiliate of any such beneficial owner
pursuant to the first sentence hereof. So long as the
Governance Agreement is in effect, none of the Permitted
Holders shall be deemed an Affiliate of the Company for
purposes of Section 4.07.
"Asset Disposition" means any direct or
indirect sale, lease, transfer, conveyance or other
disposition (or series of related sales, leases, transfers,
conveyances or dispositions) of shares of Capital Stock of a
Subsidiary (other than directors' qualifying shares),
property or other assets (each referred to for the purposes
of this definition as a "disposition") by the Company or any
Subsidiary (including any disposition by means of a merger,
consolidation or similar transaction) involving an amount in
excess of $1,000,000 other than (i) a disposition by a
Subsidiary to the Company, by the Company or a Subsidiary to
a Wholly Owned Subsidiary or between Wholly Owned
Subsidiaries, (ii) a disposition of property or assets at
fair market value in the ordinary course of business and
consistent with past practices of the Company or any of its
Subsidiaries, as applicable (including sales of products to
customers, disposition of excess inventory and dispositions
of used or replaced equipment), and (iii) for purposes of
Section 4.06 only, a disposition subject to Section 4.04;
provided, that for purposes of the definition of
Consolidated Coverage Ratio, Asset Disposition shall include
all such asset dispositions regardless of amount.
"Average Life" means, as of the date of
determination, with respect to any Indebtedness, the
quotient obtained by dividing (i) the sum of the products of
the numbers of years from the date of determination to the
date of each successive scheduled principal payment of such
Indebtedness or scheduled redemption multiplied by the
amount of such payment by (ii) the sum of all such payments.
"Bank Indebtedness" means any and all
Indebtedness and other amounts payable under or in respect
of the Credit Agreement including, without limitation,
principal, premium (if any), interest (including interest
accruing at the contract rate specified in the Credit
Agreement (including, without limitation, any rate
applicable upon default) on or after the filing of any
petition in bankruptcy, or the commencement of any similar
state, federal or foreign reorganization or liquidation
proceeding, relating to the Company and interest that would
accrue but for the commencement of such proceeding whether
or not a claim for post-filing interest is allowed in such
proceedings), fees, charges, expenses, reimbursement
obligations, guarantees and all other amounts payable
thereunder or in respect thereof.
"Board of Directors" means the Board of
Directors of the Company or any committee thereof duly
authorized to act on behalf of such Board.
"Board Resolution" means a duly adopted
resolution of the Board of Directors in full force and
effect at the time of determination and certified as such by
the Secretary or an Assistant Secretary of the Company.
"Business Day" means each day which is not a
Legal Holiday.
"Capitalized Lease Obligation" means an
obligation that is required to be classified and accounted
for as a capitalized lease for financial reporting purposes
in accordance with GAAP; and the amount of Indebtedness
represented by such obligation shall be the capitalized
amount of such obligation determined in accordance with
GAAP; and the Stated Maturity thereof shall be the date of
the last payment of rent or any other amount due under such
lease prior to the first date upon which such lease may be
terminated by the lessee without payment of a penalty.
"Capital Stock" of any Person means any and all
shares, interests, rights to purchase, warrants, options,
participations or other equivalents of or interests
(including partnership interests) in (however designated)
equity of such Person, including any Preferred Stock, but
excluding any debt securities convertible into such equity.
"Cash Equivalents" means (i) marketable direct
obligations issued or unconditionally guaranteed by the
United States government and backed by the full faith and
credit of the United States government; (ii) domestic and
Eurodollar certificates of deposit and time deposits,
bankers' acceptances and floating rate certificates of
deposit issued by any commercial bank organized under the
laws of the United States, any state thereof, the District
of Columbia, any foreign bank, or its branches or agencies
(fully protected against currency fluctuations), which, at
the time of acquisition, are rated A-1 (or better) by
Standard & Poor's Corporation (or its successors) or P-1 (or
better) by Moody's Investors Service, Inc. (or its
successors); (iii) commercial paper of United States and
foreign banks and bank holding companies and their
subsidiaries and United States and foreign finance,
commercial industrial or utility companies which, at the
time of acquisition, are rated A-1 (or better) by Standard &
Poor's Corporation (or its successors) or P-1 (or better) by
Moody's Investors Service, Inc. (or its successors);
(iv) marketable direct obligations of any state of the
United States of America or any political subdivision of any
such state given on the date of such investment the highest
credit rating by Moody's Investor Service, Inc. (or its
successors) and Standard & Poor's Corporation (or its
successors); and (v) reverse purchase agreement covering
obligations of the type specified in clause (i); provided
that the maturities of any such Cash Equivalents referred to
in clauses (i) through (v) shall not exceed one hundred
eighty (180) days.
"Change of Control" means the occurrence of any
of the following events: (i) (A) any "person" (as such term
is used in Sections 13(d) and 14(d) of the Exchange Act),
other than (x) one or more Permitted Holders or (y) an
underwriter engaged in a firm commitment underwriting in
connection with a public offering of the Voting Stock of the
Company, is or becomes the "beneficial owner" (as defined in
Rules 13d-3 and 13d-5 under the Exchange Act, except that a
person shall be deemed to have "beneficial ownership" of all
shares that any such person has the right to acquire,
whether such right is exercisable immediately or only after
the passage of time), directly or indirectly, of more than
35% of the total voting power of the Voting Stock of the
Company and (B) the Permitted Holders "beneficially own" (as
defined in Rules 13d-3 and 13d-5 under the Exchange Act),
directly or indirectly, in the aggregate a lesser percentage
of the total voting power of the Voting Stock of the Company
than such other person "beneficially owns" (as defined in
clause (A)) and do not have the right or ability by voting
power, contract or otherwise to elect or designate for
election a majority of the Board of Directors (for the
purposes of this clause (i), such other person shall be
deemed to beneficially own any Voting Stock of a specified
corporation held by a parent corporation, if such other
person "beneficially owns" (as defined in clause (A)),
directly or indirectly, more than 35% of the voting power of
the Voting Stock of such parent corporation and the
Permitted Holders "beneficially own" (as defined in
Rules 13d-3 and 13d-5 under the Exchange Act), directly or
indirectly, in the aggregate a lesser percentage of the
voting power of the Voting Stock of such parent corporation
than such other person "beneficially owns" (as defined in
clause (A)) and do not have the right or ability by voting
power, contract or otherwise to elect or designate for
election a majority of the board of directors of such parent
corporation); (ii) during any period of two consecutive
years, individuals who at the beginning of such period
constituted the Board of Directors of the Company (together
with any new directors whose election by such Board of
Directors or whose nomination for election by the
shareholders of the Company was approved pursuant to the
Governance Agreement or by a vote of 66-2/3% of the
directors of the Company then still in office who were
either directors at the beginning of such period or whose
election or nomination for election was previously so
approved) cease for any reason to constitute a majority of
the Board of Directors then in office; or (iii) the Company
sells, conveys, leases or otherwise transfers all or
substantially all its assets to any Person pursuant to a
transaction in which any holder of the Voting Stock of the
Company immediately prior to such transaction "beneficially
owns" (as defined in Rules 13d-3 and 13d-5 under the
Exchange Act), directly or indirectly, a lesser amount of
the Voting Stock of the Person that acquired such assets
immediately after such transaction.
"Ciba" means CIBA-GEIGY Limited, a corporation
organized under the laws of Switzerland.
"Closing" shall have the meaning assigned
thereto in the Strategic Alliance Agreement.
"Code" means the Internal Revenue Code of 1986,
as amended.
"Company" means the party named as such in this
Indenture until a successor replaces it and, thereafter,
means the successor.
"Consolidated Coverage Ratio" as of any date of
determination means the ratio of (i) the aggregate amount of
EBITDA for the period of the most recent four consecutive
fiscal quarters ending at least 45 days prior to the date of
such determination to (ii) Consolidated Interest Expense for
such four fiscal quarters; provided, however, that (1) if
the Company or any Subsidiary has Incurred any Indebtedness
since the beginning of such period that remains outstanding
on such date of determination or if the transaction giving
rise to the need to calculate the Consolidated Coverage
Ratio is an Incurrence of Indebtedness, EBITDA and
Consolidated Interest Expense for such period shall be
calculated after giving effect on a pro forma basis to such
Indebtedness as if such Indebtedness had been Incurred on
the first day of such period and the discharge of any other
Indebtedness repaid, repurchased, defeased or otherwise
discharged with the proceeds of such new Indebtedness as if
such discharge had occurred on the first day of such period,
(2) if since the beginning of such period the Company or any
Subsidiary shall have made any Asset Disposition, the EBITDA
for such period shall be reduced by an amount equal to the
EBITDA (if positive) directly attributable to the assets
which are the subject of such Asset Disposition for such
period or increased by an amount equal to the EBITDA (if
negative) directly attributable thereto for such period and
Consolidated Interest Expense for such period shall be
reduced by an amount equal to the Consolidated Interest
Expense directly attributable to any Indebtedness of the
Company or any Subsidiary repaid, repurchased, defeased or
otherwise discharged with respect to the Company and its
continuing Subsidiaries in connection with such Asset
Disposition for such period (or, if the Capital Stock of any
Subsidiary is sold, the Consolidated Interest Expense for
such period directly attributable to the Indebtedness of
such Subsidiary to the extent the Company and its continuing
Subsidiaries are no longer liable for such Indebtedness
after such sale), (3) if since the beginning of such period
the Company or any Subsidiary (by merger or otherwise) shall
have made an Investment in any Subsidiary (or any Person
which becomes a Subsidiary) or an acquisition of assets,
including any acquisition of assets occurring in connection
with a transaction causing a calculation to be made
hereunder, which constitutes all or substantially all of an
operating unit of a business, EBITDA and Consolidated
Interest Expense for such period shall be calculated after
giving pro forma effect thereto (including the Incurrence of
any Indebtedness) as if such Investment or acquisition
occurred on the first day of such period and (4) if since
the beginning of such period any Person (that subsequently
became a Subsidiary or was merged with or into the Company
or any Subsidiary since the beginning of such period) shall
have made any Asset Disposition or any Investment or
acquisition of assets that would have required an adjustment
pursuant to clause (2) or (3) above if made by the Company
or a Subsidiary during such period, EBITDA and Consolidated
Interest Expense for such period shall be calculated after
giving pro forma effect thereto as if such Asset
Disposition, Investment or acquisition of assets occurred on
the first day of such period. For purposes of this
definition, whenever pro forma effect is to be given to an
acquisition of assets, the amount of income or earnings
relating thereto and the amount of Consolidated Interest
Expense associated with any Indebtedness Incurred in
connection therewith, the pro forma calculations shall be
determined in good faith by a responsible financial or
accounting Officer of the Company. If any Indebtedness bears
a floating rate of interest and is being given pro forma
effect, the interest expense on such Indebtedness shall be
calculated as if the rate in effect on the date of
determination had been the applicable rate for the entire
period (taking into account any Interest Rate Protection
Agreement applicable to such Indebtedness if such Interest
Rate Protection Agreement has a remaining term as at the
date of determination in excess of 12 months).
"Consolidated Interest Expense" means, for any
period, the total interest expense of the Company and its
consolidated Subsidiaries, plus, to the extent not included
in such interest expense, (i) interest expense attributable
to capital leases, (ii) amortization of debt discount and
debt issuance cost, (iii) capitalized interest, (iv) non-
cash interest expense, (v) accrued interest,
(vi) commissions, discounts and other fees and charges owed
with respect to letters of credit and bankers' acceptance
financing, (vii) interest actually paid by the Company or
any such Subsidiary under any Guarantee of Indebtedness or
other obligation of any other Person, (viii) net costs
associated with Hedging Obligations (including amortization
of fees), (ix) the interest portion of any deferred
obligation, (x) Preferred Stock dividends in respect of all
Preferred Stock of Subsidiaries and Redeemable Stock of the
Company held by Persons other than the Company or a Wholly
Owned Subsidiary and (xi) cash contributions to any employee
stock ownership plan or other trust for the benefit of
employees to the extent such contributions are used by such
plan or trust to pay interest or fees to any Person (other
than the Company) in connection with Indebtedness Incurred
by such plan or trust.
"Consolidated Net Income" means, for any
period, the net income (loss) of the Company and its
consolidated Subsidiaries; provided, however, that there
shall not be included in such Consolidated Net Income
(i) any net income (loss) of any Person if such Person is
not a Subsidiary, except that (A) subject to the limitations
contained in clause (iv) below, the Company's equity in the
net income of any such Person for such period shall be
included in such Consolidated Net Income up to the aggregate
amount of cash actually distributed by such Person during
such period to the Company or a Subsidiary as a dividend or
other distribution (subject, in the case of a dividend or
other distribution to a Subsidiary, to the limitations
contained in clause (iii) below) and (B) the Company's
equity in a net loss of any such Person for such period
shall be included in determining such Consolidated Net
Income, (ii) any net income (loss) of any person acquired by
the Company or a Subsidiary in a pooling of interests
transaction for any period prior to the date of such
acquisition, (iii) any net income (loss) of any Subsidiary
if such Subsidiary is subject to restrictions, directly or
indirectly, on the payment of dividends or the making of
distributions by such Subsidiary, directly or indirectly, to
the Company, except that (A) subject to the limitations
contained in (iv) below, the Company's equity in the net
income of any such Subsidiary for such period shall be
included in such Consolidated Net Income up to the aggregate
amount of cash that could have been distributed by such
Subsidiary during such period to the Company or another
Subsidiary as a dividend (subject, in the case of a dividend
to another Subsidiary, to the limitation contained in this
clause) and (B) the Company's equity in a net loss of any
such Subsidiary for such period shall be included in
determining such Consolidated Net Income, (iv) any gain (but
not loss) realized upon the sale or other disposition of any
property, plant or equipment of the Company or its
consolidated Subsidiaries (including pursuant to any sale-
and-leaseback transaction) which is not sold or otherwise
disposed of in the ordinary course of business and any gain
(but not loss) realized upon the sale or other disposition
of any Capital Stock of any Person, (v) any extraordinary
gain or loss and (vi) the cumulative effect of a change in
accounting principles.
"Consolidated Net Worth" means the total of the
amounts shown on the balance sheet of the Company and its
consolidated Subsidiaries, determined on a consolidated
basis in accordance with GAAP, as of the end of the most
recent fiscal quarter of the Company ending at least 45 days
prior to the taking of any action for the purpose of which
the determination is being made, as (i) the par or stated
value of all outstanding Capital Stock of the Company plus
(ii) paid-in capital or capital surplus relating to such
Capital Stock plus (iii) any retained earnings or earned
surplus less (A) any accumulated deficit and (B) any amounts
attributable to Disqualified Stock.
"Credit Agreement" means, collectively, the
Credit Agreement dated as of February 29, 1996, among the
Company, certain of its Subsidiaries, the financial
institutions from time to time party thereto as Lenders and
Issuing Banks, Citibank, N.A., in its separate capacity as
administrative agent for the Lenders and Issuing Banks,
Citibank International plc, in its separate capacity as
European administrative agent for the Lenders and Issuing
Banks, and Credit Suisse, in its separate capacity as
syndication agent for the Lenders and Issuing Banks, as the
same may from time to time be amended, renewed, supplemented
or otherwise modified at the option of the parties thereto,
and any other agreement pursuant to which any of the
Indebtedness, commitments, obligations, costs, expenses,
fees, reimbursements and other indemnities payable or owing
thereunder may be replaced or refinanced, in any such event
having an aggregate principal amount and availability not in
excess of $175,000,000 plus amounts otherwise permitted
pursuant to Section 4.03(b)(i).
"Currency Exchange Protection Agreement" means,
in respect of any Person, any foreign exchange contract,
currency swap agreement, currency option or other similar
agreement or arrangement designed to protect such Person
against fluctuations in currency exchange rates.
"Default" means any event which is, or after
notice or passage of time or both would be, an Event of
Default.
"Designated Senior Indebtedness" means (i) the
Bank Indebtedness and (ii) any other Senior Indebtedness
which, at the date of determination, has an aggregate
principal amount outstanding of, or under which, at the date
of determination, the holders thereof, are committed to lend
up to, at least $45 million and is specifically designated
by the Company in the instrument evidencing or governing
such Senior Indebtedness as "Designated Senior Indebtedness"
for purposes of this Indenture and has been designated as
"Designated Senior Indebtedness" for purposes of this
Indenture in an Officers' Certificate received by the
Trustee.
"DIC" means the joint venture entered into
between the Company and Dainippon Ink & Chemicals, Inc.
("Dainippon"), pursuant to that certain Parent Company
Agreement dated as of April 17, 1990 under which the Company
and Dainippon caused Hexcel Technologies, Inc. and DIC
Technologies, Inc., (wholly-owned subsidiaries of the
Company and Dainippon Ink & Chemicals, Inc., respectively)
to enter into that certain Participants Agreement dated as
of September 14, 1990 pursuant to which Hexcel Technologies,
Inc. and DIC Technologies, Inc. formed Hexcel-DIC
Partnership ("HDP") and pursuant to which Hexcel
Technologies, Inc. and DIC Technologies Inc., caused HDP to
form DIC-Hexcel, Ltd. as a wholly-owned subsidiary of HDP.
"Disqualified Stock" of a Person means
Redeemable Stock of such Person as to which the maturity,
mandatory redemption, conversion or exchange or redemption
at the option of the holder thereof occurs, or may occur, on
or prior to the first anniversary of the Stated Maturity of
the Securities.
"Dollar Equivalent" means, with respect to any
monetary amount in a currency other than U.S. dollars, at
any time for the determination thereof, the amount of U.S.
dollars obtained by converting such foreign currency
involved in such computation into U.S. dollars at the spot
rate for the purchase of U.S. dollars with the applicable
foreign currency as quoted by Bankers Trust Company in
New York City at approximately 11:00 a.m. (New York time) on
the date two Business Days prior to such determination.
"EBITDA" for any period means the Consolidated
Net Income for such period, plus the following to the extent
deducted in calculating such Consolidated Net Income:
(i) income tax expense, (ii) Consolidated Interest Expense,
(iii) depreciation expense and (iv) amortization expense, in
each case for such period.
"Exchange Act" means the Securities Exchange
Act of 1934, as amended.
"Existing Joint Ventures" means (i) Knytex,
(ii) DIC and (iii) Fyfe.
"fair market value" means, with respect to any
asset or property, the price which could be negotiated in an
arms'-length free market transaction between a willing
seller and a willing buyer, neither of whom is under undue
pressure or compulsion to complete the transaction.
"Fyfe" means Hexcel Fyfe L.L.C., a Delaware
limited liability company.
"GAAP" means generally accepted accounting
principles in the United States of America as in effect at
the time of the Closing, including those set forth in the
opinions and pronouncements of the Accounting Principles
Board of the American Institute of Certified Public
Accountants and statements and pronouncements of the
Financial Accounting Standards Board or in such other
statements by such other entity as approved by a significant
segment of the accounting profession. All ratios and
computations based on GAAP contained in this Indenture shall
be computed in conformity with GAAP consistently applied.
"Governance Agreement" means the Governance
Agreement dated as of February 29, 1996, between Ciba and
the Company.
"Guarantee" means any obligation, contingent or
otherwise, of any Person directly or indirectly guaranteeing
any Indebtedness or other obligation of any other Person and
any obligation, direct or indirect, contingent or otherwise,
of such Person (i) to purchase or pay (or advance or supply
funds for the purchase or payment of) such Indebtedness or
other obligation of such other Person (whether arising by
virtue of partnership arrangements, or by agreement to keep-
well, to purchase assets, goods, securities or services, to
take-or-pay or to maintain financial statement conditions or
otherwise) or (ii) entered into for purposes of assuring in
any other manner the obligee of such Indebtedness or other
obligation of the payment thereof or to protect such obligee
against loss in respect thereof (in whole or in part);
provided, however, that the term "Guarantee" shall not
include (i) endorsements for collection or deposit in the
ordinary course of business or (ii) obligations, warranties
and indemnities, not with respect to Indebtedness of any
Person, that have been or are undertaken or made in the
ordinary course of business or in connection with any Asset
Disposition permitted by Section 4.06 and not for the
benefit of or in favor of an Affiliate of the Company or any
of its Subsidiaries. The term "Guarantee" used as a verb
has a corresponding meaning.
"Hedging Obligations" of any Person means the
obligations of such Person pursuant to any Interest Rate
Protection Agreement or Currency Exchange Protection
Agreement or other similar agreement or arrangement
involving interest rates, currencies, commodities or
otherwise.
"Holder" or "Securityholder" means the Person
in whose name a Security is registered on the Registrar's
books.
"Incur" means issue, assume, Guarantee, incur
or otherwise become liable for; provided, however, that any
Indebtedness or Capital Stock of a Person existing at the
time such person becomes a Subsidiary (whether by merger,
consolidation, acquisition or otherwise) shall be deemed to
be incurred by such Subsidiary at the time it becomes a
Subsidiary. The terms "Incurred", "Incurrence" and
"Incurring" shall each have a correlative meaning.
"Indebtedness" means, with respect to any
Person on any date of determination (without duplication),
(i) the principal of and premium (if any) in
respect of indebtedness of such Person for
borrowed money;
(ii) the principal of and premium (if any) in
respect of obligations of such Person evidenced by
bonds, debentures, notes or other similar
instruments;
(iii) all Capitalized Lease Obligations of such
Person;
(iv) all obligations of such Person to pay the
deferred and unpaid purchase price of property or
services (except Trade Payables);
(v) all obligations of such Person in respect
of letters of credit, banker's acceptances or
other similar instruments or credit transactions
(including reimbursement obligations with respect
thereto), other than obligations with respect to
letters of credit securing obligations (other than
obligations described in (i) through (iv) above)
entered into in the ordinary course of business of
such Person to the extent such letters of credit
are not drawn upon or, if and to the extent drawn
upon, such drawing is reimbursed no later than the
third Business Day following receipt by such
Person of a demand for reimbursement following
payment on any such letter of credit;
(vi) the amount of all obligations of such
Person with respect to the redemption, repayment
or other repurchase of any Disqualified Stock or,
with respect to any Subsidiary, any Preferred
Stock (but excluding, in each case, any accrued
dividends);
(vii) all Indebtedness of other Persons secured
by a Lien on any asset of such Person, whether or
not such Indebtedness is assumed by such Person;
provided, however, that the amount of such
Indebtedness shall be the lesser of (A) the fair
market value of such asset at such date of
determination and (B) the amount of such
Indebtedness of such other Persons;
(viii) all Indebtedness of other Persons to the
extent Guaranteed by such Person; and
(ix) to the extent not otherwise included in
this definition, obligations of such Person in
respect of Hedging Obligations.
For purposes of this definition, the maximum fixed
redemption, repayment or repurchase price of any
Disqualified Stock or Preferred Stock that does not have a
fixed redemption, repayment or repurchase price shall be
calculated in accordance with the terms of such Stock as if
such Stock were redeemed, repaid or repurchased on any date
on which Indebtedness shall be required to be determined
pursuant to the Indenture; provided, however, that if such
Stock is not then permitted to be redeemed, repaid or
repurchased, the redemption, repayment or repurchase price
shall be the book value of such Stock as reflected in the
most recent financial statements of such Person. The amount
of Indebtedness of any Person at any date shall be the
outstanding balance at such date of all unconditional
obligations as described above and the maximum liability,
upon the occurrence of the contingency giving rise to the
obligation, of any contingent obligations at such date.
"Indenture" means this instrument as originally
executed or as it may from time to time be supplemented or
amended by one or more indentures supplemental hereto
entered into pursuant to the applicable provisions hereof.
"Interest Rate Protection Agreement" means, in
respect of any Person, any interest rate swap agreement,
interest rate option agreement, interest rate cap agreement,
interest rate collar agreement, interest rate floor
agreement or other similar agreement or arrangement designed
to protect such Person against fluctuations in interest
rates.
"Investment" in any Person means any direct or
indirect advance, loan (other than advances to customers or
suppliers in the ordinary course of business that are
recorded as accounts receivable on the balance sheet of such
Person) or other extension of credit (including by way of
Guarantee or similar arrangement) or capital contribution to
(by means of any transfer of cash or other property to
others or any payment for property or services for the
account or use of others), or any purchase or acquisition of
Capital Stock, Indebtedness or other similar instruments
issued by such Person. For purposes of Section 4.04,
(i) "Investment" shall include the portion (proportionate to
the Company's equity interest in such Subsidiary) of the
fair market value of the net assets of any Subsidiary of the
Company, (ii) any property transferred to or from a
Subsidiary shall be valued at its fair market value at the
time of such transfer and (iii) "Investment" shall not
include any Guaranty or other Indebtedness existing at the
time of the Closing owed by the Company or any of its
Subsidiaries in respect of Dainippon Ink & Chemicals, Inc.
or Hexcel-DIC Partnership. In determining the amount of any
Investment in respect of any property or assets other than
cash, such property or asset shall be valued at its fair
market value at the time of such Investment (unless
otherwise specified in this definition), as determined in
good faith by the Board of Directors, whose determination
shall be evidenced by a Board Resolution (if the value of
the such property or asset is greater than $3,000,000).
"Issue Date" means the date on which the
Securities are originally issued.
"Knytex" means the joint venture entered into
between the Company and Owens-Corning Fiberglas Corporation
pursuant to a Limited Liability Company Agreement dated as
of June 14, 1993 for the production and marketing of, among
other items, stitchbonded fabrics.
"Knytex Credit Facility" means that certain
$4,500,000 revolving credit facility entered into between
Knytex and Creekwood Capital Corporation pursuant to a Loan
Agreement dated as of January 26, 1995.
"Lenders" has the meaning specified in the
Credit Agreement.
"Lien" means any mortgage, pledge, security
interest, encumbrance, lien or charge of any kind (including
any conditional sale or other title retention agreement or
lease in the nature thereof).
"Maximum Partnership/Joint Venture Investment
Amount" means the sum, without duplication, of (i) all cash
Investments made by the Company after the time of the
Closing, plus (ii) all Investments that the Company is under
a contractual obligation to make after the time of the
Closing, plus (iii) the amount of all Guarantees incurred
after the time of the Closing, in each case in or on behalf
of any partnership in which the Company or any Subsidiary is
a general or limited partner or any joint venture (other
than the Existing Joint Ventures) to which the Company or
any Subsidiary is a party.
"Net Available Cash" from an Asset Disposition
means cash payments received (including any cash payments
received by way of deferred payment of principal pursuant to
a note or installment receivable or otherwise, but only as
and when received, but excluding any other consideration
received in the form of assumption by the acquiring person
of Indebtedness or other obligations relating to such
properties or assets or received in any other noncash form)
therefrom, in each case net of (i) all legal, title and
recording tax expenses, commissions and other fees and
expenses incurred, and all Federal, state, provincial,
foreign and local taxes required to be paid or accrued as a
liability under GAAP as a consequence of such Asset
Disposition, (ii) all payments made on any Indebtedness
which is secured by any assets subject to such Asset
Disposition, in accordance with the terms of any Lien upon
such assets, or which must by its terms, or in order to
obtain a necessary consent to such Asset Disposition, or by
applicable law, be repaid out of the proceeds from such
Asset Disposition, (iii) all distributions and other
payments required to be made to minority interest holders in
Subsidiaries or joint ventures as a result of such Asset
Disposition and (iv) the deduction of appropriate amounts to
be provided by the seller as a reserve, in accordance with
GAAP, against any liabilities associated with the assets
disposed of in such Asset Disposition and retained by the
Company or any Subsidiary after such Asset Disposition.
"Net Cash Proceeds", with respect to any
issuance or sale of Capital Stock, means the cash proceeds
of such issuance or sale net of attorneys' fees,
accountants' fees, underwriters' or placement agents' fees,
discounts or commissions and brokerage, consultant and other
fees actually incurred in connection with such issuance or
sale and net of taxes paid or payable as a result thereof.
"Officer" means the Chairman of the Board, the
Chief Executive Officer, the President, any Vice President,
the Chief Financial Officer, the Treasurer, the Comptroller
or the Secretary of the Company.
"Officers' Certificate" means a certificate
signed by two Officers or by an Officer and an Assistant
Secretary of the Company.
"Opinion of Counsel" means a written opinion
from legal counsel who is acceptable to the Trustee. The
counsel may be an employee of or counsel to the Company or
the Trustee.
"pari passu", as applied to the ranking of any
Indebtedness of a Person in relation to other Indebtedness
of such Person, means that each such Indebtedness either
(i) is not subordinate in right of payment to any
Indebtedness or (ii) is subordinate in right of payment to
the same Indebtedness as is the other, and is so subordinate
to the same extent, and is not subordinate in right of
payment to each other or to any Indebtedness as to which the
other is not so subordinate.
"Permitted Holders" means, collectively, Ciba,
its Affiliates, and any successor corporation of, and any
corporation succeeding to ownership of, any thereof.
"Permitted Investment" means an Investment by
the Company or any Subsidiary in (i) a Subsidiary or a
Person which will, upon the making of such Investment,
become a Subsidiary; provided, however, that the primary
business of such Subsidiary is a Related Business; (ii)
another Person if as a result of such Investment such other
Person is merged or consolidated with or into, or transfers
or conveys all or substantially all its assets to, the
Company or a Subsidiary; provided, however, that such
Person's primary business is a Related Business;
(iii) Temporary Cash Investments; (iv) receivables owing to
the Company or any Subsidiary, if created or acquired in the
ordinary course of business and payable or dischargeable in
accordance with customary trade terms; provided, however,
that such trade terms may include such concessionary trade
terms as the Company or any such Subsidiary deems reasonable
under the circumstances; (v) payroll, travel and similar
advances to cover matters that are expected at the time of
such advances ultimately to be treated as expenses for
accounting purposes and that are made in the ordinary course
of business; (vi) loans or advances to employees made in the
ordinary course of business consistent with past practices
of the Company or such Subsidiary, as the case may be; and
(vii) stock, obligations or securities received (a) in
settlement of debts created in the ordinary course of
business and owing to the Company or any Subsidiary, (b) in
satisfaction of judgments or (c) as consideration in
connection with an Asset Disposition permitted by
Section 4.06; provided that, in the case of this clause (c),
such stock, obligations or securities shall constitute no
more than 25% of the total consideration received therefrom
by the Company or any Subsidiary.
"Person" means any individual, corporation,
limited liability or other company, partnership, joint
venture, association, joint-stock company, trust,
unincorporated organization, government or any agency or
political subdivision thereof or any other entity.
"Preferred Stock", as applied to the Capital
Stock of any corporation, means Capital Stock of any class
or classes (however designated) which is preferred as to the
payment of dividends, or as to the distribution of assets
upon any voluntary or involuntary liquidation or dissolution
of such corporation, over shares of Capital Stock of any
other class of such corporation.
"principal" of a Security means the principal
of the Security, if any, payable on the Security which is
due or overdue or is to become due at the relevant time.
"pro forma" means, with respect to any
calculation made or required to be made pursuant to the
terms hereof, a calculation in accordance with Article 11 of
Regulation S-X promulgated under the Securities Act (to the
extent applicable), as interpreted in good faith by the
Board of Directors after consultation with the independent
certified public accountants of the Company, or otherwise a
calculation made in good faith by the Board of Directors
after consultation with the independent certified public
accountants of the Company, as the case may be.
"Redeemable Stock" means, with respect to any
Person, any Capital Stock which by its terms (or by the
terms of any security into which it is convertible or for
which it is exchangeable) or upon the happening of any event
(i) matures or is mandatorily redeemable pursuant to a
sinking fund obligation or otherwise, (ii) is convertible or
exchangeable for Indebtedness (other than Preferred Stock)
or Disqualified Stock or (iii) is redeemable at the option
of the holder thereof, in whole or in part.
"Refinancing Indebtedness" means Indebtedness
that refunds, refinances, replaces, renews, repays or
extends (including pursuant to any defeasance or discharge
mechanism) (collectively, "refinances," and "refinanced"
shall have a correlative meaning) any Indebtedness existing
at the time of the Closing or Incurred in compliance with
this Indenture (including Indebtedness of the Company that
refinances Indebtedness of any Subsidiary and Indebtedness
of any Subsidiary that refinances Indebtedness of another
Subsidiary) including Indebtedness that refinances
Refinancing Indebtedness; provided, however, that (i) the
Refinancing Indebtedness has a Stated Maturity no earlier
than any Stated Maturity of the Indebtedness being
refinanced, (ii) the Refinancing Indebtedness has an Average
Life at the time such Refinancing Indebtedness is Incurred
that is equal to or greater than the Average Life of the
Indebtedness being refinanced and (iii) such Refinancing
Indebtedness is Incurred in an aggregate principal amount
(or if issued with original issue discount, an aggregate
issue price) that is equal to or less than the aggregate
principal amount (or if issued with original issue discount,
the aggregate accreted value) of the Indebtedness being
refinanced (including, with respect to both the Refinancing
Indebtedness and the Indebtedness being refinanced, amounts
then outstanding and amounts available thereunder); provided
further, however, that Refinancing Indebtedness shall not
include Indebtedness of a Subsidiary that refinances
Indebtedness of the Company.
"Representative" means the trustee, agent or
other representative (if any) for an issue of Senior
Indebtedness.
"SEC" means the Securities and Exchange
Commission.
"Secured Indebtedness" means any Indebtedness
of the Company secured by a Lien.
"Securities" means the Securities issued under
this Indenture without regard to the series of which the
Securities are a part, except to the extent provided in the
fourth paragraph of Section 2.02 of this Indenture.
"Securities Act" means the Securities Act of
1933, as amended.
"Senior Indebtedness" means (i) all Bank
Indebtedness and (ii) all other Indebtedness of the Company,
including interest (including, without limitation, interest
accruing at the contract rate specified in the Credit
Agreement or the documentation governing such other
Indebtedness, as applicable (including, without limitation,
any rate applicable upon default) on or after the filing of
any petition in bankruptcy, or the commencement of any
similar state, federal or foreign reorganization or
liquidation proceeding, relating to the Company, whether or
not allowed as a claim against the Company in any such
proceeding) and fees thereon, whether outstanding at the
time of the Closing or thereafter issued or Incurred, unless
in the instrument creating or evidencing the same or
pursuant to which the same is outstanding it is provided
that such obligations are not superior in right of payment
to the Securities; provided, however, that Senior
Indebtedness shall not include (1) any liability for
Federal, state, local or other taxes owed or owing by the
Company, (2) any Trade Payables, (3) any Indebtedness,
Guarantee or obligation of the Company which is subordinate
or junior in any respect to any other Indebtedness,
Guarantee or obligation of the Company, including any Senior
Subordinated Indebtedness and any Subordinated Obligations,
(4) any obligations with respect to any Capital Stock,
(5) any Indebtedness Outstanding or Incurred in violation of
this Indenture or (6) any obligation of the Company to any
Affiliate of the Company.
"Senior Subordinated Indebtedness" means the
Securities and any other Indebtedness of the Company that
specifically provides that such Indebtedness is to rank pari
passu with the Securities and is not subordinated by its
terms to any Indebtedness or other obligation of the Company
which is not Senior Indebtedness.
"Significant Subsidiary" means a Subsidiary of
the Company that is a "significant subsidiary" as defined in
Rule 1-02 of Regulation S-X promulgated under the Securities
Act and the Exchange Act.
"Specified Equipment" means the mixers
(i) Myers Mod. V550/550A, 30-15-50 H. P. Drivers, 250 Gal.
Vacuum Resin Mixing Tank, Screw-Hi Shear & Anchor
w/Insulated, Heated Controls, Explosion Proof, S/N 918 and
(ii) Myers Mod. V550/550A, 50-25-75 H. P. Drivers, 500 Gal.
Vacuum Resin Mixing Tank, Insulated, Heated, Screw-Hi Shear
& Anchor, Valves, Computer & Controls, Explosion Proof,
S/N 921, together with all attachments and appurtenances
thereto and any related equipment to be used by the Company
to manufacture products pursuant to the Manufacturing and
Supply Agreement between the Company and Ciba-Geigy
Corporation dated as of February 29, 1996.
"Specified Properties" shall mean the Company's
manufacturing plants located in (i) Lancaster, Ohio,
(ii) Anaheim, California, (iii) Welkenraedt, Belgium and
(iv) Graham, Texas.
"Stated Maturity" means, with respect to any
security, the date specified in such security as the fixed
date on which the payment of principal of such security is
due and payable, including pursuant to any mandatory
redemption provision (but excluding any provision providing
for the repurchase of such security at the option of the
holder thereof upon the happening of any contingency beyond
the control of the issuer unless such contingency has
occurred).
"Strategic Alliance Agreement" means the
Strategic Alliance Agreement dated as of September 29, 1995,
as amended as of December 12, 1995, and as further amended
by letter agreement dated as of February 28, 1996, among
Ciba, Ciba-Geigy Corporation and the Company.
"Subordinated Obligation" means any
Indebtedness of the Company (whether outstanding at the time
of Closing or thereafter Incurred) which is subordinate or
junior in right of payment to the Securities pursuant to a
written agreement.
"Subsidiary" of any Person means any
corporation, association, partnership or other business
entity of which more than 50% of the total voting power of
shares of Capital Stock entitled (without regard to the
occurrence of any contingency) to vote in the election of
directors, managers or trustees thereof is at the time owned
or controlled, directly or indirectly, by (i) such Person,
(ii) such Person and one or more Subsidiaries of such Person
or (iii) one or more Subsidiaries of such Person. Unless
the context requires otherwise, "Subsidiary" shall refer to
a Subsidiary of the Company.
"Temporary Cash Investments" means any of the
following: (i) investments in U.S. Government Obligations
maturing within 180 days of the date of acquisition thereof,
(ii) investments in time deposit accounts, certificates of
deposit and money market deposits maturing within 180 days
of the date of acquisition thereof issued by a bank or trust
company which is organized under the laws of the United
States of America, any State thereof or any foreign country
recognized by the United States of America having capital,
surplus and undivided profits aggregating in excess of
$250,000,000 (or the Dollar Equivalent thereof) and whose
long-term debt is rated "A-" or higher according to Moody's
Investors Service, Inc. (or such equivalent rating by at
least one "nationally recognized statistical rating
organization" (as defined in Rule 436 under the Securities
Act)), (iii) repurchase obligations with a term of not more
than 30 days for underlying securities of the types
described in clause (i) above entered into with a bank
meeting the qualifications described in clause (ii) above
and (iv) investments in commercial paper, maturing not more
than 90 days after the date of acquisition, issued by a
corporation (other than an Affiliate of the Company)
organized and in existence under the laws of the United
States of America or any foreign country recognized by the
United States of America with a rating at the time as of
which any investment therein is made of "P-1" (or higher)
according to Moody's Investors Service, Inc. or "A-1" (or
higher) according to Standard and Poor's Corporation.
"TIA" means the Trust Indenture Act of 1939
(15 U.S.C. SECTION 77aaa-77bbbb) as in effect on the date of this
Indenture.
"Trade Payables" means, with respect to any
Person, any accounts payable or any indebtedness or monetary
obligation to trade creditors created, assumed or Guaranteed
by such Person arising in the ordinary course of business of
such Person in connection with the acquisition of goods or
services.
"Trustee" means the party named as such in this
Indenture until a successor replaces it in accordance with
the provisions of this Indenture and, thereafter, means the
successor.
"Trust Officer" means the Chairman of the
Board, the President or any other officer or assistant
officer of the Trustee assigned by the Trustee to administer
its corporate trust matters.
"Uniform Commercial Code" means the New York
Uniform Commercial Code as in effect from time to time.
"U.S. Government Obligations" means direct
obligations (or certificates representing an ownership
interest in such obligations) of the United States of
America (including any agency or instrumentality thereof)
for the payment of which the full faith and credit of the
United States of America is pledged and which are not
callable or redeemable at the issuer's option.
"Voting Stock" of a corporation means all
classes of Capital Stock of such corporation then
outstanding and normally entitled to vote in the election of
directors.
"Wholly Owned Subsidiary" means a Subsidiary of
the Company all the Capital Stock of which (other than
directors' qualifying shares) is owned by the Company or
another Wholly Owned Subsidiary.
SECTION 1.02. Other Definitions.
DEFINED IN TERM
SECTION
"Affiliate Transaction" ................ 4.07
"Bankruptcy Law" ....................... 6.01
"Blockage Notice" ...................... 10.03
"covenant defeasance option" ........... 8.01(b)
"Custodian" ............................ 6.01
"Event of Default" ..................... 6.01
"legal defeasance option" .............. 8.01(b)
"Legal Holiday" ........................ 11.07
"Notice of Default...................... 6.01
"Offer" ................................ 4.06
"Offer Amount" ......................... 4.06
"Offer Period" ......................... 4.06
"pay the Securities" ................... 10.03
"Paying Agent" ......................... 2.03
"Payment Blockage Period" .............. 10.03
"Purchase Date" ........................ 4.06
"Refinanced Indebtedness" ............. 4.03(d)
"Registrar"............................. 2.03
"Restricted Payment" ................... 4.04
"Successor Company" .................... 5.01(b)
SECTION 1.03. Incorporation by Reference of
Trust Indenture Act. This Indenture is subject to the
mandatory provisions of the TIA which are incorporated by
reference in and made a part of this Indenture. The
following TIA terms have the following meanings:
"Commission" means the SEC.
"indenture securities" means the Securities.
"indenture security holder" means a Holder or a
Securityholder.
"indenture to be qualified" means this
Indenture.
"indenture trustee" or "institutional trustee"
means the Trustee.
"obligor" on the indenture securities means the
Company and any other obligor on the Securities.
All other TIA terms used in this Indenture that
are defined by the TIA, defined by TIA reference to another
statute or defined by SEC rule and not otherwise defined
herein have the meanings assigned to them by such
definitions.
SECTION 1.04. Rules of Construction. Unless
the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined
has the meaning assigned to it in accordance with
GAAP;
(3) "or" is not exclusive;
(4) "including" means including without
limitation;
(5) words in the singular include the plural
and words in the plural include the singular;
(6) unsecured Indebtedness shall not be deemed
to be subordinate or junior to Secured
Indebtedness merely by virtue of its nature as
unsecured Indebtedness;
(7) the principal amount of any noninterest
bearing or other discount security at any date
shall be the principal amount thereof that would
be shown on a balance sheet of the issuer dated
such date prepared in accordance with GAAP; and
(8) the principal amount of any Preferred Stock
shall be the greater of (i) the maximum
liquidation value of such Preferred Stock or
(ii) the maximum mandatory redemption or mandatory
repurchase price with respect to such Preferred
Stock.
ARTICLE 2
THE SECURITIES
SECTION 2.01. Form and Dating. The Securities
and the Trustee's certificate of authentication shall be
substantially in the form of Exhibit A, which is hereby
incorporated in and expressly made a part of this Indenture.
The Securities may have notations, legends or endorsements
required by law, stock exchange rule, agreements to which
the Company is subject, if any, or usage (provided that any
such notation, legend or endorsement is in a form acceptable
to the Company). The Company shall furnish any such legend
not contained in Exhibit A to the Trustee in writing. Each
Security shall be dated the date of its authentication.
SECTION 2.02. Execution and Authentication;
Issuance. Two Officers shall sign the Securities for the
Company by manual or facsimile signature. The Company's
seal shall be impressed, affixed, imprinted or reproduced on
the Securities and may be in facsimile form.
If an Officer whose signature is on a Security
no longer holds that office at the time the Trustee
authenticates the Security, the Security shall be valid
nevertheless.
A Security shall not be valid until an
authorized signatory of the Trustee manually signs the
certificate of authentication on the Security. The
signature shall be conclusive evidence that the Security has
been authenticated under this Indenture.
The Securities shall be issued in up to three
series. At least three Business Days prior to the date upon
which the Securities in a series are to be issued (unless
the Trustee consents to a shorter period), the Company shall
deliver to the Trustee an Officers' Certificate that
(a) sets forth (i) the principal amount of the Securities in
the series to be issued, (ii) the date on which the original
issuance of Securities in such series shall be
authenticated, (iii) the date from which interest shall
accrue and (iv) the first interest payment date, whether
March 1 or September 1, and (b) provides instructions
concerning registration, amounts for each Holder and
delivery. The Trustee shall be entitled to rely upon such
Officers' Certificate without further investigation. The
Company shall not be required to deliver an Opinion of
Counsel in connection with such Officer's Certificate.
Except as set forth in the first sentence of this paragraph,
the terms of all the series of Securities shall be identical
and all Securities issued hereunder shall be deemed to
constitute a single series regardless of the date on which
such Securities are issued.
Upon receipt of the applicable Officers'
Certificate, the Trustee shall authenticate and deliver
Securities of the applicable series for original issue in
the aggregate principal amount specified therein.
The Trustee may appoint an authenticating agent
reasonably acceptable to the Company to authenticate the
Securities. Unless limited by the terms of such
appointment, an authenticating agent may authenticate
Securities whenever the Trustee may do so. Each reference
in this Indenture to authentication by the Trustee includes
authentication by such agent. An authenticating agent has
the same rights as any Registrar, Paying Agent or agent for
service of notices and demands.
Securities shall be issuable only in registered
form, without coupons, in denominations of $1,000 and any
integral multiple thereof.
SECTION 2.03. Registrar and Paying Agent. The
Company shall maintain an office or agency where Securities
may be presented for registration of transfer or for
exchange (the "Registrar") and an office or agency where
Securities may be presented for payment (the "Paying
Agent"). The Registrar shall keep a register of the
Securities and of their transfer and exchange. The Company
may have one or more co-registrars and one or more
additional paying agents. The term "Paying Agent" includes
any additional paying agent.
The Company shall enter into an appropriate
agency agreement with any Registrar, Paying Agent or co-
registrar not a party to this Indenture, which shall
implement the provisions of this Indenture that relate to
such agent. Any such agency agreement with any Paying Agent
shall incorporate the terms of the TIA which relate to the
duties of a Paying Agent. The Company shall notify the
Trustee of the name and address of any such agent. If the
Company fails to maintain a Registrar or Paying Agent, the
Trustee shall act as such and shall be entitled to
appropriate compensation therefor pursuant to Section 7.07.
The Company or any of its domestically incorporated Wholly
Owned Subsidiaries may act as Paying Agent, Registrar, co-
registrar or transfer agent.
The Company initially appoints the Trustee as
Registrar and Paying Agent in connection with the
Securities.
SECTION 2.04. Paying Agent To Hold Money in
Trust. Prior to each due date of the principal and interest
on any Security, the Company shall deposit with the Paying
Agent a sum sufficient to pay such principal and interest
when so becoming due. The Company shall require each Paying
Agent (other than the Trustee) to agree in writing that the
Paying Agent shall hold in trust for the benefit of
Securityholders or the Trustee all money held by the Paying
Agent for the payment of principal of or interest on the
Securities and shall notify the Trustee of any default by
the Company in making any such payment. If the Company or a
Subsidiary acts as Paying Agent, it shall segregate the
money held by it as Paying Agent and hold it as a separate
trust fund. The Company at any time may require a Paying
Agent to pay all money held by it to the Trustee and to
account for any funds disbursed by the Paying Agent, and
upon such payment the Paying Agent shall have no further
liability for the money delivered to the Trustee.
SECTION 2.05. Securityholder Lists. The
Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the
names and addresses of Securityholders. If the Trustee is
not the Registrar, the Company shall furnish to the Trustee,
in writing at least five Business Days before each interest
payment date and at such other times as the Trustee may
request in writing a list in such form and as of such date
as the Trustee may reasonably require of the names and
addresses of Securityholders, and the Company shall
otherwise comply with TIA SECTION 312(a).
SECTION 2.06. Transfer and Exchange. The
Securities shall be issued in registered form and shall be
transferable only upon the surrender of a Security for
registration of transfer. When a Security is presented to
the Registrar or a co-registrar with a request to register a
transfer, the Registrar shall register the transfer as
requested if the requirements of Section 8-401(1) of the
Uniform Commercial Code are met. When Securities are
presented to the Registrar or a co-registrar with a request
to exchange them for an equal principal amount of Securities
of other denominations, the Registrar shall make the
exchange as requested if the same requirements are met. To
permit registration of transfers and exchanges, the Company
shall execute and the Trustee shall authenticate Securities
at the Registrar's or co-registrar's request. The Company
may require payment of a sum sufficient to pay all taxes,
assessments or other governmental charges in connection with
any transfer or exchange pursuant to this Section. The
Company shall not be required to make and the Registrar
shall not be required to register transfers or exchanges of
any Security (i) during a period of 15 days before any
selection of securities to be redeemed or 15 days before an
interest payment date or (ii) selected for redemption in
whole or in part, except the unredeemed portion of any
Security being redeemed in part.
Prior to the due presentation for registration
of transfer of any Security, the Company, the Trustee, the
Paying Agent, the Registrar or any co-registrar may deem and
treat the person in whose name a Security is registered as
the absolute owner of such Security for the purpose of
receiving payment of principal of and interest on such
Security and for all other purposes whatsoever, whether or
not such Security is overdue, and none of the Company, the
Trustee, the Paying Agent, the Registrar or any co-registrar
shall be affected by notice to the contrary.
All Securities issued upon any transfer or
exchange pursuant to the terms of this Indenture will
evidence the same debt and will be entitled to the same
benefits under this Indenture as the Securities surrendered
upon such transfer or exchange.
SECTION 2.07. Replacement Securities. If a
mutilated Security is surrendered to the Registrar or if the
Holder of a Security claims that the Security has been lost,
destroyed or wrongfully taken, the Company shall issue and
the Trustee shall authenticate a replacement Security if the
requirements of Section 8-405 of the Uniform Commercial Code
are met and the Holder satisfies any other reasonable
requirements of the Trustee or the Company. If required by
the Trustee or the Company, such Holder shall furnish an
indemnity bond sufficient in the judgment of the Company and
the Trustee to protect the Company, the Trustee, the Paying
Agent, the Registrar and any co-registrar from any loss
which any of them may suffer if a Security is replaced. The
Company and the Trustee may charge the Holder for their
expenses in replacing a Security.
Every replacement Security is an additional
obligation of the Company.
SECTION 2.08. Outstanding Securities.
Securities outstanding at any time are all Securities
authenticated by the Trustee except for those canceled by
it, those delivered to it for cancellation and those
described in this Section as not outstanding. A Security
does not cease to be outstanding because the Company or an
Affiliate of the Company holds the Security.
If a Security is replaced pursuant to
Section 2.07, it ceases to be outstanding unless the Trustee
and the Company receive proof satisfactory to them that the
replaced Security is held by a bona fide purchaser.
If the Paying Agent segregates and holds in
trust, in accordance with this Indenture, on a redemption
date or maturity date money sufficient to pay all principal
and interest payable on that date with respect to the
Securities (or portions thereof) to be redeemed or maturing,
as the case may be, and the Paying Agent is not prohibited
from paying such money to the Securityholders on that date
pursuant to the terms of this Indenture, then on and after
that date such Securities (or portions thereof) cease to be
outstanding and interest on them ceases to accrue.
In determining whether the Holders of the
required principal amount of Securities have concurred in
any direction, waiver or consent or any amendment,
modification or other change to the Indenture, Securities
owned by the Company or by any Person directly or indirectly
controlling or controlled by or under direct or indirect
common control with the Company shall be disregarded and
treated as if they were not outstanding, except that for the
purposes of determining whether the Trustee shall be
protected in relying on any such direction, waiver or
consent or any amendment, modification or other change to
the Indenture, only Securities which the Trustee knows are
so owned shall be so disregarded.
SECTION 2.09. Temporary Securities. Until
definitive Securities are ready for delivery, the Company
may prepare and the Trustee shall authenticate temporary
Securities. Temporary Securities shall be substantially in
the form of definitive Securities but may have variations
that the Company considers appropriate for temporary
Securities. Without unreasonable delay, the Company shall
prepare and the Trustee shall authenticate definitive
Securities and deliver them in exchange for temporary
Securities.
SECTION 2.10. Cancellation. The Company at
any time may deliver Securities to the Trustee for
cancellation. The Registrar and the Paying Agent shall
forward to the Trustee any Securities surrendered to them
for registration of transfer, exchange or payment. The
Trustee and no one else shall cancel and destroy (subject to
the record retention requirements of the Exchange Act) all
Securities surrendered for registration of transfer,
exchange, payment or cancellation and deliver a certificate
of such destruction to the Company unless the Company
directs the Trustee to deliver canceled Securities to the
Company. The Company may not issue new Securities to
replace Securities it has redeemed, paid or delivered to the
Trustee for cancellation.
SECTION 2.11. Defaulted Interest. Any
interest on any Security which is payable, but is not
punctually paid or duly provided for, on the dates and in
the manner provided in the Securities and this Indenture
(herein called "Defaulted Interest") shall forthwith cease
to be payable to the Holder on the relevant record date by
virtue of having been such Holder, and such Defaulted
Interest may be paid by the Company, at its election in each
case, as provided in clause (i) or (ii) below:
(i) The Company may elect to make payment of
any Defaulted Interest to the Persons in whose
names the Securities are registered at the close
of business on a special record date for the
payment of such Defaulted Interest, which shall be
fixed in the following manner. The Company shall
notify the Trustee in writing of the amount of
Defaulted Interest proposed to be paid on each
Security and the date of the proposed payment.
Thereupon the Trustee shall fix a special record
date for the payment of such Defaulted Interest
which shall be not more than 15 days and not less
than 10 days prior to the date of the proposed
payment and not less than 10 days after the
receipt by the Trustee of the notice of the
proposed payment. The Trustee shall promptly
notify the Company of such special record date
and, in the name and at the expense of the
Company, shall cause notice of the proposed
payment of such Defaulted Interest and the special
record date therefor to be given to each Holder,
not less than 10 days prior to such special record
date. The Company shall deposit with the Trustee
an amount of cash equal to the aggregate amount of
the proposed payment and shall make arrangements
satisfactory to the Trustee for such deposit on or
prior to the date of the proposed payment. Notice
of the proposed payment of such Defaulted Interest
and the special record date therefor having been
so mailed, such Defaulted Interest shall be paid
to the Persons in whose names the Securities are
registered at the close of business on such
special record date.
(ii) The Company may make payment of any
Defaulted Interest on the Securities in any other
lawful manner not inconsistent with the
requirements of any securities exchange on which
the Securities may be listed, and upon such notice
as may be required by such exchange, if, after
notice given by the Company to the Trustee of the
proposed payment pursuant to this clause, such
manner of payment shall be deemed practicable by
the Trustee.
Subject to the foregoing provisions of this
Section 2.11, each Security delivered under this Indenture
upon registration of transfer of or in exchange for or in
lieu of any other Security shall carry the rights to
interest accrued and unpaid, and to accrue, which were
carried by such other Security.
SECTION 2.12. Record Date. The Company may
set a record date for purposes of determining the identity
of Securityholders entitled to vote or to consent to any
action by vote of consent authorized or permitted by
Sections 6.04, 6.05 and 11.06. Unless this Indenture
provides otherwise, such record date shall be the later of
30 days prior to the first solicitation of such consent or
the date of the most recent list of Holders furnished to the
Trustee pursuant to Section 2.05 prior to such solicitation.
SECTION 2.13. Agreement With Initial Holder.
As of the date of this Indenture, the Company and Ciba have
entered into an agreement, a copy of which is attached
hereto as Exhibit B (the "Retention Agreement"). The
Securities shall bear the legend referred to in the
Retention Agreement until the Trustee receives a written
notice from the Company requesting that such legend be
removed. Upon receipt of such notice, the Trustee shall
issue, or cause to be issued, replacement Securities that do
not bear such legend, as otherwise provided in this
Indenture. The Company shall not be required to provide an
Officers' Certificate or an Opinion of Counsel in connection
with such notice.
ARTICLE 3
REDEMPTION
SECTION 3.01. Notices to Trustee. If the
Company elects to redeem Securities pursuant to paragraph 5
of the Securities, it shall notify the Trustee in writing of
the redemption date, the principal amount of Securities to
be redeemed and the paragraph of the Securities pursuant to
which the redemption will occur.
The Company shall give each notice to the
Trustee provided for in this Section at least 45 days before
the redemption date unless the Trustee consents to a shorter
period. Such notice shall be accompanied by an Officers'
Certificate from the Company to the effect that such
redemption will comply with the conditions herein. An
Opinion of Counsel shall not be required in connection with
such notice.
SECTION 3.02. Selection of Securities To Be
Redeemed. If fewer than all the Securities are to be
redeemed, the Trustee shall select the Securities to be
redeemed pro rata or by lot or by a method that complies
with applicable legal and securities exchange requirements,
if any, and that the Trustee considers fair and appropriate
and in accordance with methods generally used at the time of
selection by fiduciaries in similar circumstances. The
Trustee shall make the selection from outstanding Securities
not previously called for redemption. The Trustee may
select for redemption portions of the principal of
Securities that have denominations larger than $1,000.
Securities and portions of them the Trustee selects shall be
in amounts of $1,000 or a whole multiple of $1,000.
Provisions of this Indenture that apply to Securities called
for redemption also apply to portions of Securities called
for redemption. The Trustee shall notify the Company
promptly of the Securities or portions of Securities to be
redeemed.
SECTION 3.03. Notice of Redemption. At least
30 days but not more than 60 days before a date for
redemption of Securities, the Company shall mail a notice of
redemption by first-class mail to each Holder of Securities
to be redeemed.
The notice shall identify the Securities to be
redeemed and shall state:
(1) the redemption date;
(2) the redemption price;
(3) the name and address of the Paying Agent;
(4) that Securities called for redemption must
be surrendered to the Paying Agent to collect the
redemption price;
(5) if fewer than all the outstanding
Securities are to be redeemed, the identification
and principal amounts of the particular Securities
to be redeemed;
(6) that, unless the Company defaults in making
such redemption payment or the Paying Agent is
prohibited from making such payment pursuant to
the terms of this Indenture, interest on
Securities (or portion thereof) called for
redemption ceases to accrue on and after the
redemption date;
(7) the paragraph of the Securities pursuant to
which the Securities called for redemption are
being redeemed; and
(8) the CUSIP number of the Securities to be
redeemed, if any, and that no representation is
made as to the correctness or accuracy of the
CUSIP number, if any, listed in such notice or
printed on the Securities.
At the Company's request, the Trustee shall
give the notice of redemption in the Company's name and at
the Company's expense. In such event, the Company shall
provide the Trustee with the information required by this
Section.
SECTION 3.04. Effect of Notice of Redemption.
Once notice of redemption is mailed pursuant to
Section 3.03, Securities called for redemption become due
and payable on the redemption date and at the redemption
price stated in the notice. Upon surrender to the Paying
Agent, such Securities shall be paid at the redemption price
stated in the notice, plus accrued interest to the
redemption date (subject to the right of Holders of record
on the relevant record date to receive interest due on the
related interest payment date). Failure to give notice or
any defect in the notice to any Holder shall not affect the
validity of the notice to any other Holder.
SECTION 3.05. Deposit of Redemption Price.
Prior to the redemption date, the Company shall deposit with
the Paying Agent (or, if the Company or a Subsidiary is the
Paying Agent, shall segregate and hold in trust) money
sufficient to pay the redemption price of and accrued
interest (subject to the right of Holders of record on the
relevant record date to receive interest due on the related
interest payment date) on all Securities to be redeemed on
that date other than Securities or portions of Securities
called for redemption which have been delivered by the
Company to the Trustee for cancellation.
SECTION 3.06. Securities Redeemed in Part.
Upon surrender of a Security that is redeemed in part, the
Company shall execute and the Trustee shall authenticate for
the Holder (at the Company's expense) a new Security equal
in principal amount to the unredeemed portion of the
Security surrendered.
ARTICLE 4
COVENANTS
SECTION 4.01. Payment of Securities. The
Company shall promptly pay the principal of and interest on
the Securities on the dates and in the manner provided in
the Securities and in this Indenture. Principal and
interest shall be considered paid on the date due if on such
date the Trustee or the Paying Agent holds in accordance
with this Indenture money sufficient to pay all principal
and interest then due and the Trustee or the Paying Agent,
as the case may be, is not prohibited from paying such money
to the Securityholders on that date pursuant to the terms of
this Indenture.
The Company shall pay interest on overdue
principal at the rate specified therefor in the Securities,
and it shall pay interest on overdue installments of
interest at the same rate to the extent lawful.
SECTION 4.02. SEC Reports. If at any time
following the Closing the Company is not required to file
annual reports and other reports pursuant to Section 13 or
15(d) of the Exchange Act, the Company shall file with the
SEC and, following the Issue Date, provide the Trustee and
Securityholders with such annual reports and such
information, documents and other reports as are specified in
Sections 13 and 15(d) of the Exchange Act and applicable to
a U.S. corporation subject to such Sections, such
information, documents and other reports to be so filed and
provided at the times specified for the filing of such
information, documents and reports under such Sections. The
Company also shall comply with the other provisions of
TIA SECTION 314(a).
SECTION 4.03. Limitation on Indebtedness.
(a) Following the Closing, the Company shall not, and shall
not permit any Subsidiary to, Incur any Indebtedness;
provided, however, that the Company may Incur Indebtedness
if the Consolidated Coverage Ratio on the date of such
Incurrence exceeds 2.0 to 1.0.
(b) Notwithstanding Section 4.03(a), the
Company and its Subsidiaries may Incur the following
Indebtedness:
(i) Indebtedness under the Credit Agreement
and any other loan or other agreement in an
aggregate principal amount outstanding at any time
not to exceed (A) the sum of the outstanding
Indebtedness under the Credit Agreement and the
unused commitments thereunder at the time of the
Closing and (B) $12,500,000;
(ii) Indebtedness (other than Indebtedness
permitted to be Incurred pursuant to
Section 4.03(a) or any other clause of this
Section 4.03(b)), and any Refinancing Indebtedness
Incurred in respect thereof, in an aggregate
principal amount outstanding at any time not to
exceed $12,500,000 million (less the principal
outstanding Indebtedness incurred pursuant to
clause (i)(B) above);
(iii) Indebtedness owing to and held by the
Company or any Wholly Owned Subsidiary; provided,
however, that any subsequent issuance or transfer
of any Capital Stock which results in any such
Wholly Owned Subsidiary ceasing to be a Wholly
Owned Subsidiary or any subsequent transfer of any
such Indebtedness (except to the Company or a
Wholly Owned Subsidiary) shall be deemed, in each
case, to constitute the Incurrence of such
Indebtedness;
(iv) Indebtedness represented by the Securities
and any Indebtedness (other than the Indebtedness
described in clauses (i)-(iii) above) outstanding
at the time of the Closing;
(v) Indebtedness of a Subsidiary Incurred and
outstanding on or prior to the date on which such
Subsidiary was acquired by, or otherwise became a
Subsidiary of, the Company (other than
Indebtedness Incurred as consideration in, or to
provide all or any portion of the funds or credit
support utilized to consummate, the transaction or
series of related transactions pursuant to which
such Subsidiary became a Subsidiary or was
otherwise acquired by the Company); provided,
however, that at the time such Subsidiary is
acquired by the Company, the Company would have
been able to Incur $1.00 of additional
Indebtedness pursuant to Section 4.03(a) after
giving effect to the Incurrence of such
Indebtedness pursuant to this clause (v);
(vi) Refinancing Indebtedness Incurred in
respect of Indebtedness Incurred pursuant to
clause (iv) or (v) above;
(vii) Indebtedness under Hedging Obligations to
the extent permitted under the Credit Agreement;
(viii) Indebtedness in respect of Capital Leases
and purchase money Indebtedness incurred by the
Company or its Subsidiaries to finance the
acquisition of tangible assets, and Indebtedness
incurred by the Company or its Subsidiaries to
refinance such Capital Leases and purchase money
Indebtedness, in an aggregate outstanding
principal amount not to exceed $12,500,000 at any
time;
(ix) Indebtedness in an amount not to exceed
$6,000,000 in the aggregate in respect of
obligations of the Company owing to the New Jersey
Department of Environmental Protection in
existence at the time of the Closing;
(x) (A) Guarantees of any Subsidiary in respect
of obligations of the Company and (B) Guarantees
of any partnership or joint venture (other than
Existing Joint Ventures) to the extent that the
Incurrence of suchobligations shall not cause the
Maximum Partnership/Joint Venture Investment
Amount to exceed $7,000,000 at any time; provided
that no such Investment may be made as long as any
Default or Event of Default has occurred and is
continuing or would occur as a result of such
Investment;
(xi) Indebtedness under appeal bonds in
connection with judgements that do not result in a
Default or Event of Default;
(xii) Guarantees made by the Company to Dainippon
Ink & Chemical, Inc. or Hexcel-DIC Partnership in
an aggregate amount not to exceed $5,500,000;
(xiii) Guarantees relating to the Acquisition; or
(xiv) subordination of certain amounts payable to
the Company by Knytex as provided for in the
Knytex Credit Facility.
(c) Notwithstanding any other provision of
this Section 4.03, the Company shall not Incur any
Indebtedness pursuant to Section 4.03(b) if the proceeds
thereof are used, directly or indirectly, to repay, prepay,
redeem, defease, retire, refund or refinance any
Subordinated Obligations unless such Indebtedness shall be
subordinated to the Securities to at least the same extent
as such Subordinated Obligations. The Company shall not
Incur any Indebtedness pursuant to Section 4.03(a) or
4.03(b) if such Indebtedness is subordinate or junior in
ranking in any respect to any Senior Indebtedness unless
such Indebtedness is Senior Subordinated Indebtedness or is
expressly subordinated in right of payment to Senior
Subordinated Indebtedness. In addition, the Company shall
not Incur any Secured Indebtedness which is not Senior
Indebtedness unless contemporaneously therewith effective
provision is made to secure the Securities equally and
ratably with such Secured Indebtedness for so long as such
Secured Indebtedness is secured by a Lien.
(d) For purposes of determining whether the
principal amount of any Refinancing Indebtedness permitted
by this Section does not, in the event it is issued in a
currency different from the currency in which the
Indebtedness being refunded or refinanced or paid at
maturity ("Refinanced Indebtedness") was issued, exceed the
principal amount of the Refinanced Indebtedness, the spot
rate for the purchase of the currency of the Refinanced
Indebtedness with the currency of the Refinancing
Indebtedness, as published in The Wall Street Journal in the
"Exchange Rates" column under the heading "Currency Trading"
on the date two Business Days prior to such determination,
shall be used. If The Wall Street Journal does not publish
such spot rate on such date, then the spot rate for the
purchase of the currency of the Refinanced Indebtedness with
the currency of the Refinancing Indebtedness, as quoted by
Bankers Trust Company, or any successor thereto, in New York
City at approximately 11:00 a.m. (New York time) on the date
two Business Days prior to such determination, shall be
used.
Except as provided in the preceding paragraph,
for purposes of determining the Dollar Equivalent of any
Indebtedness denominated in a currency other than U.S.
dollars outstanding at any time as permitted by this
Section, such Dollar Equivalent shall be the Dollar
Equivalent of such currency at the date such Indebtedness is
issued; provided, however, that if such Indebtedness
constituted Refinancing Indebtedness, such conversion shall
be made based on the Dollar Equivalent of the Refinanced
Indebtedness at the date of the issuance of the Refinanced
Indebtedness (or any preceding Refinanced Indebtedness, as
applicable).
SECTION 4.04. Limitation on Restricted
Payments. (a) Following the Closing, the Company shall not,
and shall not permit any Subsidiary, directly or indirectly,
to (i) declare or pay any dividend or make any distribution
on or in respect of its Capital Stock (including any payment
in connection with any merger or consolidation involving the
Company) except dividends or distributions payable solely in
its Capital Stock (other than Disqualified Stock) or in
options, warrants or other rights to purchase such Capital
Stock and except dividends or distributions payable to the
Company or a Subsidiary (and, if such Subsidiary is not
wholly owned, to its other shareholders on a pro rata
basis), (ii) purchase, redeem, retire or otherwise acquire
for value any Capital Stock of the Company or any Subsidiary
held by Persons other than the Company or a Subsidiary,
(iii) purchase, repurchase, redeem, defease or otherwise
acquire or retire for value, prior to scheduled maturity,
scheduled repayment or scheduled sinking fund payment any
Subordinated Obligations (other than the purchase,
repurchase or other acquisition of Subordinated Obligations
purchased in anticipation of satisfying a sinking fund
obligation, principal installment or final maturity, in each
case due within one year of the date of acquisition) or (iv)
make any Investment (other than a Permitted Investment) in
any Person (any such dividend, distribution, purchase,
redemption, repurchase, defeasance, other acquisition,
retirement or Investment being herein referred to as a
"Restricted Payment") if at the time the Company or such
Subsidiary makes such Restricted Payment:
(1) a Default shall have occurred and be
continuing (or would result therefrom);
(2) the Company could not incur at least $1.00
of additional Indebtedness under Section 4.03(a);
or
(3) the aggregate amount of such Restricted
Payment and all other Restricted Payments (the
amount so expended, if other than in cash, to be
determined in good faith by the Board of
Directors, whose determination shall be evidenced
by a Board Resolution) declared or made since
December 31, 1995, would exceed, without
duplication, the sum of:
(a) $15,000,000 plus an amount equal to 50% of
the Consolidated Net Income accrued during the
period (treated as one accounting period) from
January 1, 1996, to the end of the most recent
fiscal quarter ending at least 45 days prior to
the date of such Restricted Payment (or, in
case such Consolidated Net Income shall be a
deficit, minus 100% of such deficit) and minus
100% of the amount of any write-downs, write-
offs, other negative revaluations and other
negative extraordinary charges not otherwise
reflected in Consolidated Net Income during
such period;
(b) the aggregate Net Cash Proceeds received by
the Company from the issue or sale of its
Capital Stock (other than Disqualified Stock)
subsequent to January 1, 1996, (other than an
issuance or sale to a Subsidiary of the Company
or an employee stock ownership plan or other
trust established by the Company or any of its
Subsidiaries); and
(c) the amount by which Indebtedness of the
Company or its Subsidiaries is reduced on the
Company's balance sheet upon the conversion or
exchange (other than by a Subsidiary),
subsequent to January 1, 1996, of any
Indebtedness of the Company or its Subsidiaries
convertible or exchangeable for Capital Stock
(other than Disqualified Stock) of the Company
(less the amount of any cash or other property
distributed by the Company or any Subsidiary
upon such conversion or exchange).
(b) The provisions of Section 4.04(a) shall
not prohibit:
(i) any purchase or redemption of Capital Stock
of the Company or Subordinated Obligations made by
exchange for, or out of the proceeds of the
substantially concurrent sale of, Capital Stock of
the Company (other than Disqualified Stock and
other than Capital Stock issued or sold to a
Subsidiary or an employee stock ownership plan or
other trust established by the Company or any of
its Subsidiaries); provided, however, that
(A) such purchase or redemption shall be excluded
in the calculation of the amount of Restricted
Payments and (B) the Net Cash Proceeds from such
sale shall be excluded from clause (3)(b) of
Section 4.04(a);
(ii) any purchase or redemption of Subordinated
Obligations made by exchange for, or out of the
proceeds of the substantially concurrent sale of,
Indebtedness of the Company which is permitted to
be Incurred pursuant to Section 4.03; provided,
however, that such Indebtedness (A) shall be
subordinated to the Securities and shall be
subordinated to Senior Indebtedness and Senior
Subordinated Indebtedness to at least the same
extent as the Subordinated Obligations so
exchanged, purchased or redeemed, (B) shall have a
Stated Maturity later than the Stated Maturity of
the Securities and (C) shall have an Average Life
greater than the remaining Average Life of the
Securities; provided, further, that such purchase
or redemption shall be excluded in the calculation
of the amount of Restricted Payments;
(iii) any purchase or redemption of Subordinated
Obligations from Net Available Cash to the extent
permitted by Section 4.06; provided, however, that
such purchase or redemption shall be excluded in
the calculation of the amount of Restricted
Payments;
(iv) dividends paid within 60 days after the
date of declaration thereof if at such date of
declaration such dividend would have complied with
Section 4.04(a); provided, however, that at the
time of payment of such dividend, no other Default
shall have occurred and be continuing (or result
therefrom); provided further, however, that such
dividend shall be included in the calculation of
the amount of Restricted Payments from and after
the date of declaration thereof;
(v) so long as no Default shall have occurred
and be continuing (or result therefrom),
Restricted Payments in an aggregate amount not to
exceed $25,000,000; provided that all such
Restricted Payments permitted under this
paragraph (v) shall be excluded from the
calculation of the amount of Restricted Payments;
(vi) any scheduled payment by the Company or any
of its Subsidiaries in respect of any Guaranty or
other Indebtedness existing at the time of the
Closing owed by the Company or any of its
Subsidiaries in respect of Dainippon Ink &
Chemicals, Inc. and Hexcel-DIC Partnership;
provided, however, that an aggregate amount of up
to $6,250,000 of such payments shall be excluded
in the calculation of the amount of Restricted
Payments;
(vii) promissory notes and other Investments
relating to the sale of the Specified Properties;
(viii) payments with respect to employee or
director stock options, stock incentive plans or
restricted stock plans of the Company;
(ix) payments of Indebtedness made in connection
with the Acquisition; or
(x) the Investment in a letter of credit or
other Investment relating to obligations of the
Company owing to the New Jersey Department of
Environmental Protection in existence at the time
of the Closing.
SECTION 4.05. Limitation on Restrictions on
Distributions from Subsidiaries. Following the Closing, the
Company shall not, and shall not permit any Subsidiary to,
create or otherwise cause or permit to exist or become
effective any encumbrance or restriction on the ability of
any Subsidiary to (i) pay dividends or make any other
distributions on or in respect of its Capital Stock or pay
any Indebtedness owed to the Company or any Subsidiary,
(ii) make any loans or advances to the Company or
(iii) transfer any of its property or assets to the Company
or any Subsidiary, except:
(1) any encumbrance or restriction pursuant to
the Credit Agreement, this Indenture and any
agreement in effect at or entered into at the time
of the Closing;
(2) any encumbrance or restriction with respect
to a Subsidiary pursuant to an agreement relating
to any Indebtedness Incurred by such Subsidiary on
or prior to the date on which such Subsidiary
became a Subsidiary of, or was acquired by, the
Company (other than Indebtedness Incurred as
consideration in, or to provide all or any portion
of the funds or credit support utilized to
consummate, the transaction or series of related
transactions pursuant to which such Subsidiary
became a Subsidiary of, or was acquired by, the
Company) and outstanding on such date;
(3) any encumbrance or restriction pursuant to
an agreement effecting a refinancing of
Indebtedness Incurred pursuant to an agreement
referred to in clause (1) or (2) of this
Section 4.05 or contained in any amendment to an
agreement referred to in clause (1) or (2) of this
Section 4.05; provided, however, that the
encumbrances and restrictions contained in any
such refinancing agreement or amendment are no
less favorable to the Securityholders than
encumbrances and restrictions contained in such
agreements;
(4) in the case of clause (iii), any
encumbrance or restriction (A) consisting of
customary non-assignment provisions in leases
governing leasehold interests to the extent such
provisions restrict the transfer of the lease or
the property leased thereunder, (B) contained in
security agreements or mortgages securing
Indebtedness of a Subsidiary to the extent such
restrictions restrict the transfer of the property
subject to such security agreements or mortgages,
(C) arising by virtue of any transfer of,
agreement to transfer, option or right with
respect to, or Lien on, any property or assets of
the Company or any Subsidiary not otherwise
prohibited by this Indenture or (D) arising or
agreed to in the ordinary course of business and
that does not, individually or in the aggregate,
detract from the value of property or assets of
the Company or any Subsidiary in any manner
material to the Company or such Subsidiary; and
(5) any restriction with respect to a
Subsidiary imposed pursuant to an agreement
entered into for the sale or disposition of all or
substantially all the Capital Stock or assets of
such Subsidiary pending the closing of such sale
or disposition.
SECTION 4.06. Limitation on Sales of Assets
and Subsidiary Stock. (a) Following the Closing, the
Company and its Subsidiaries may make Asset Dispositions in
an aggregate amount not to exceed $10 million in any fiscal
year of the Company.
(b) Following the Closing, the Company shall
not, and shall not permit any Subsidiary to, make any Asset
Disposition which, either alone or together with all other
Asset Dispositions made by the Company and its Subsidiaries
during such fiscal year, exceeds $10 million unless (i) the
Company or such Subsidiary receives consideration at the
time of such Asset Disposition at least equal to the fair
market value, as determined in good faith by the Board of
Directors (if such fair market value is greater than
$10,000,000), the determination of which shall be evidenced
by a Board Resolution (including as to the value of all non-
cash consideration (if such fair market value is greater
than $3,000,000)), of the shares and assets subject to such
Asset Disposition, (ii) at least 75% of the consideration
thereof received by the Company or such Subsidiary is in the
form of cash and (iii) an amount equal to 100% of the Net
Available Cash from such Asset Disposition is applied by the
Company (or such Subsidiary, as the case may be) (A) first,
to the extent the Company elects (or is required by the
terms of any Senior Indebtedness), to prepay, repay or
purchase Senior Indebtedness or Indebtedness (other than any
Preferred Stock) of a Wholly Owned Subsidiary (in each case
other than Indebtedness owed to the Company or an Affiliate
of the Company) within 270 days from the later of the date
of such Asset Disposition or the receipt of such Net
Available Cash; (B) second, to the extent of the balance of
Net Available Cash after application in accordance with
clause (A), to the extent the Company or such Subsidiary
elects, to reinvest in Additional Assets (including by means
of an Investment in Additional Assets by a Subsidiary with
Net Available Cash received by the Company or another
Subsidiary) within 270 days from the later of such Asset
Disposition or the receipt of such Net Available Cash;
(C) third, to the extent of the balance of such Net
Available Cash after application in accordance with
clauses (A) and (B), to make an Offer to purchase Securities
pursuant to and subject to the conditions of Section
4.06(c), and (D) fourth, to the extent of the balance of
such Net Available Cash after application in accordance with
clauses (A), (B) and (C), for any purpose not prohibited by
the terms of this Indenture.
For the purposes of this Section, the following
shall be deemed to be cash: (x) the assumption of
Indebtedness of the Company (other than Preferred Stock of
the Company) or any Subsidiary and the release of the
Company or such Subsidiary from all liability with respect
to such Indebtedness in connection with such Asset
Disposition, provided that the amount of such Indebtedness
shall not be deemed to be cash for the purpose of the term
"Net Available Cash," and (y) securities received by the
Company or any Subsidiary from the transferee that are
promptly converted by the Company or such Subsidiary into
cash.
(c) In the event of an Asset Disposition that
requires the purchase of Securities pursuant to
Section 4.06(b)(iii)(C), the Company shall purchase
Securities tendered pursuant to an offer by the Company for
the Securities (the "Offer") at a purchase price of 100% of
their principal amount plus accrued interest to the Purchase
Date in accordance with the procedures (including
prorationing in the event of oversubscription) set forth in
Section 4.06(b). If the aggregate purchase price of
Securities tendered pursuant to the Offer is less than the
Net Available Cash allotted to the purchase of the
Securities, the Company shall apply the remaining Net
Available Cash in accordance with Section 4.06(b)(iii)(D).
The Company shall not be required to make an Offer for
Securities pursuant to this Section if the Net Available
Cash available therefor (after application of the proceeds
as provided in clauses (A) and (B) of Section 4.06(b)(iii))
is less than $5,000,000 for any particular Asset Disposition
(which lesser amounts shall be carried forward for purposes
of determining whether an Offer is required with respect to
the Net Available Cash from any subsequent Asset
Disposition).
(d) (1) Promptly, and in any event within
10 days after the Company becomes obligated to make an
Offer, the Company shall be obligated to deliver to the
Trustee and send, by first-class mail to each Holder, a
written notice stating that the Holder may elect to have his
Securities purchased by the Company either in whole or in
part (subject to prorationing as hereinafter described in
the event the Offer is oversubscribed) in integral multiples
of $1,000 of principal amount, at the applicable purchase
price. The notice shall specify a purchase date not less
than 30 days nor more than 60 days after the date of such
notice (the "Purchase Date") and shall contain information
concerning the business of the Company which the Company in
good faith believes will enable such Holders to make an
informed decision (which at a minimum will include (i) the
most recently filed Annual Report on Form 10-K (including
audited consolidated financial statements) of the Company,
the most recent subsequently filed Quarterly Report on Form
10-Q and any Current Report on Form 8-K of the Company filed
subsequent to such Quarterly Report, other than Current
Reports describing Asset Dispositions otherwise described in
the offering materials (or corresponding successor reports),
(ii) a description of material developments in the Company's
business subsequent to the date of the latest of such
Reports, and (iii) if material, appropriate pro forma
financial information) and all instructions and materials
necessary to tender Securities pursuant to the Offer,
together with the information contained in clause (3).
(2) Not later than the date upon which written
notice of an Offer is delivered to the Trustee, the Company
shall deliver to the Trustee an Officers' Certificate as to
(i) the amount of the Offer (the "Offer Amount"), (ii) the
allocation of the Net Available Cash from the Asset
Dispositions pursuant to which such Offer is being made and
(iii) the compliance of such allocation with the provisions
of Section 4.06(b). Upon the expiration of the period for
which the Offer remains open (the "Offer Period"), the
Company shall deliver to the Trustee the Securities or
portions thereof which have been properly tendered to and
are to be accepted by the Company and shall irrevocably
deposit with the Trustee an amount of cash equal to the
aggregate purchase price for the Securities tendered in the
Offer, provided that such amount shall not exceed the Offer
Amount. The Trustee shall, on the Purchase Date, mail or
deliver payment to each tendering Holder in the amount of
the purchase price.
(3) Holders electing to have a Security
purchased will be required to surrender the Security, with
an appropriate form duly completed, to the Company at the
address specified in the notice at least 10 Business Days
prior to the Purchase Date. Holders will be entitled to
withdraw their election if the Trustee or the Company
receives, not later than three Business Days prior to the
Purchase Date, a telegram, facsimile transmission or letter
setting forth the name of the Holder, the principal amount
of the Security which was delivered for purchase by the
Holder and a statement that such Holder is withdrawing his
election to have such Security purchased. If, at the
expiration of the Offer Period, the aggregate principal
amount of Securities surrendered by Holders exceeds the
Offer Amount, the Company shall select the Securities to be
purchased on a pro rata basis (with such adjustments as may
be deemed appropriate by the Company so that only Securities
in denominations of $1,000, or integral multiples thereof,
shall be purchased). Holders whose Securities are purchased
only in part shall be issued new Securities equal in
principal amount to the unpurchased portion of the
Securities surrendered.
(4) On or before the Purchase Date, the
Company shall (i) accept for payment the Securities or
portions thereof that have been properly tendered pursuant
to the offer made pursuant to this Section 4.06,
(ii) deposit with the Trustee an amount of cash equal to the
aggregate amount of the aggregate purchase price for the
Securities and portions thereof properly tendered and
accepted pursuant to clause (i) and shall make arrangements
satisfactory to the Trustee for such deposit prior to the
date of the purchase date and (iii) deliver to the Trustee
the Securities or portions thereof which have been properly
tendered to and accepted by the Company. The Trustee shall,
on the Purchase Date, mail or deliver payment of the
purchase price to each tendering Holder. A Security shall
be deemed to have been accepted for purchase at the time the
Trustee, directly or through an agent, mails or delivers
payment therefor to the surrendering Holder.
(e) The Company shall comply, to the extent
applicable, with the requirements of Section 14(e) of the
Exchange Act and any other securities laws or regulations
in connection with the repurchase of Securities pursuant to
this Section. To the extent that the provisions of any
securities laws or regulations conflict with provisions of
this Section, the Company shall comply with the applicable
securities laws and regulations and shall not be deemed to
have breached its obligations under this Section by virtue
thereof.
(f) Notwithstanding anything to the contrary
contained in this Section, (i) Hexcel Technologies, Inc. may
transfer up to 15% of the outstanding partnership interests
in HDP to DIC Technologies, Inc., (ii) the Company may sell
the Specified Equipment to Ciba or any Affiliate of Ciba and
(iii) the Company or any Subsidiary may grant licenses in
respect of intellectual property to Ciba or any Subsidiary
of Ciba pursuant to the Strategic Alliance Agreement.
(g) Notwithstanding anything to the contrary
contained in this Section, the Company shall be deemed to
have complied with Section 4.06(b)(iii)(A) if the Net
Available Cash from any sale or other disposition of any of
the Specified Properties are applied to repay outstanding
loans under the Credit Agreement (whether or not the
commitments thereunder are reduced in connection therewith).
SECTION 4.07. Limitation on Transactions with
Affiliates. (a) Following the Closing, the Company shall
not, and shall not permit any Subsidiary to, directly or
indirectly, conduct any business, enter into or permit to
exist any transaction or series of similar transactions
(including the purchase, conveyance, disposition, sale,
lease or exchange of any property, employee compensation
arrangements or the rendering of any service) with, or for
the benefit of, any Affiliate of the Company involving an
amount in excess of $100,000 (an "Affiliate Transaction")
unless (i) the terms of such Affiliate Transaction are
(1) set forth in writing and (2) as favorable to the Company
or such Subsidiary, as the case may be, as those that could
be obtained at the time of such Affiliate Transaction for a
similar transaction in arm's-length dealings with a Person
who is not such an Affiliate and (ii) the disinterested
members of the Board of Directors have determined in good
faith that the criteria set forth in clause (i)(2) are
satisfied and have approved the relevant Affiliate
Transaction, such determination and approval to be evidenced
by a Board Resolution if such Affiliate Transaction involves
an amount in excess of $1,000,000; provided, however, that
if such Affiliate Transaction involves an amount in excess
of $10,000,000, the Board of Directors shall have received
an opinion from an investment banking firm of national
prominence that is not an Affiliate of the Company to the
effect that such Affiliate Transaction is fair from a
financial point of view, provided, further, that the term
"Affiliate Transaction" shall not include (A) any
transaction between the Company or any of its Subsidiaries
and (i) any Permitted Holder, (ii) Hexcel Foundation so long
as such foundation remains a not-for-profit institution for
the purposes of California law, (iii) Fyfe, (iv) Hexcel-DIC
Partnership and (v) Knytex; (B) existing employment or
compensation agreements or other arrangements with officers
or directors of the Company or any Subsidiary, (C) existing
management agreements, (D) stock options and awards granted
to employees and directors of the Company or any Subsidiary
under existing employee benefit plans, (E) any contract or
transaction providing for indemnification of officers or
directors of the Company or any Subsidiary from liability,
or providing or maintaining insurance or other arrangements
on behalf of any such officer or director against any
liability asserted against such person and incurred in or
arising out of such capacity and (F) the subrogation
agreement and related agreements entered into or to be
entered into by the Company in connection with the Knytex
Credit Facility.
(b) The provisions of Section 4.07(a) shall
not prohibit (i) any Restricted Payment permitted to be paid
pursuant to Section 4.04, (ii) any issuance of securities,
or other payments, awards or grants in cash, securities or
otherwise pursuant to, or the funding of, employment
arrangements, stock options and stock ownership plans
approved by the Board of Directors, (iii) the payment of
reasonable fees to directors of the Company and its
Subsidiaries who are not employees of the Company or of
Subsidiaries, (iv) the grant of stock options or similar
rights to employees and directors of the Company pursuant to
plans approved by the Board of Directors and (v) an
Affiliate Transaction between the Company and a Wholly Owned
Subsidiary or between Wholly Owned Subsidiaries.
SECTION 4.08. Change of Control. (a) Upon a
Change of Control, each Holder shall have the right to
require that the Company repurchase such Holder's Securities
at a purchase price in cash equal to 101% of the principal
amount thereof plus accrued and unpaid interest, if any, to
the date of purchase (subject to the right of holders of
record on the relevant record date to receive interest due
on the related interest payment date), in accordance with
the terms contemplated in Section 4.08(b). In the event
that at the time of such Change of Control the terms of the
Bank Indebtedness restrict or prohibit the repurchase of
Securities pursuant to this Section, then prior to the
mailing of the notice to Holders provided for in
Section 4.08(b) below but in any event within 30 days
following any Change of Control, the Company covenants to
(i) repay in full all Bank Indebtedness or offer to repay in
full all Bank Indebtedness and to repay the Bank
Indebtedness of each lender who has accepted such offer or
(ii) obtain the requisite consent under the agreements
governing the Bank Indebtedness to permit the repurchase of
the Securities as provided for in Section 4.08(b).
(b) Within 30 days following any Change of
Control, the Company shall send, by first-class mail to each
Holder, a notice to each Holder with a copy to the Trustee
stating:
(1) that a Change of Control has occurred and
that such Holder has the right to require the
Company to purchase such Holder's Securities at a
purchase price in cash equal to 101% of the
principal amount thereof plus accrued and unpaid
interest, if any, to the date of purchase;
(2) the circumstances and relevant facts
regarding such Change of Control (including
information with respect to pro forma historical
income, cash flow and capitalization after giving
effect to such Change of Control);
(3) the purchase date (which shall be no
earlier than 30 days nor later than 60 days from
the date such notice is mailed); and
(4) the instructions determined by the Company,
consistent with this Section, that a Holder must
follow in order to have its Securities purchased,
together with the information contained in
Section 4.08(c) (and including any related
materials).
(c) Holders electing to have a Security
purchased will be required to surrender the Security, with
an appropriate form duly completed, to the Company at the
address specified in the notice at least five Business Days
prior to the purchase date. Holders will be entitled to
withdraw their election if the Trustee or the Company
receives not later than three Business Days prior to the
purchase date, a telegram, telex, facsimile transmission or
letter setting forth the name of the Holder, the principal
amount of the Security which was delivered for purchase by
the Holder, the certificate number of such Security and a
statement that such Holder is withdrawing his election to
have such Security purchased.
(d) On or before the purchase date, the
Company shall (i) accept for payment the Securities or
portions thereof that have been properly tendered pursuant
to the offer made pursuant to this Section 4.08,
(ii) deposit with the Trustee an amount of cash equal to the
aggregate amount of the aggregate purchase price for the
Securities and portions thereof properly tendered and
accepted pursuant to clause (i) and shall make arrangements
satisfactory to the Trustee for such deposit prior to the
date of the purchase date and (iii) deliver to the Trustee
the Securities or portions thereof which have been properly
tendered to and accepted by the Company. The Trustee shall,
on the purchase date, mail or deliver payment of the
purchase price to each tendering Holder.
(e) The Company shall comply, to the extent
applicable, with the requirements of Section 14(e) of the
Exchange Act and any other securities laws or regulations
in connection with the repurchase of Securities pursuant to
this Section. To the extent that the provisions of any
securities laws or regulations conflict with provisions of
this Section, the Company shall comply with the applicable
securities laws and regulations and shall not be deemed to
have breached its obligations under this Section by virtue
thereof.
(f) Notwithstanding the foregoing, so long as
(x) the Permitted Holders beneficially own, in the
aggregate, at least 33% of the Total Voting Power of Hexcel
(as defined in and determined pursuant to the Governance
Agreement), and the transaction giving rise to such Change
of Control required the approval of a majority of Ciba
Directors (as defined in the Governance Agreement) or
(y) the Permitted Holders beneficially own, in the
aggregate, at least 40% of the Total Voting Power of Hexcel
and the transaction giving rise to such Change of Control
required the approval of at least one Ciba Director, any
Holder that is a Permitted Holder shall not have the right
to require repurchase of such Holder's Securities pursuant
to Section 4.08(a) and otherwise shall not be treated as a
Holder for purposes of Sections 4.08(a)-(e).
SECTION 4.09. Compliance Certificate. The
Company shall deliver to the Trustee within 120 days after
the end of each fiscal year of the Company an Officers'
Certificate stating that in the course of the performance by
the signers of their duties as Officers of the Company they
would normally have knowledge of any Default and whether or
not the signers know of any Default that occurred during
such period. If they do, the certificate shall describe the
Default, its status and what action the Company is taking or
proposes to take with respect thereto. The Company also
shall comply with TIA SECTION 314(a)(4).
SECTION 4.10. Further Instruments and Acts.
Upon request of the Trustee, the Company will execute and
deliver such further instruments and do such further acts as
may be reasonably necessary or proper to carry out more
effectively the purpose of this Indenture.
SECTION 4.11. Limitations on Issuance and Sale
of Subsidiary Stock. Following the Closing, the Company
shall not permit any of its Subsidiaries to issue any shares
of Capital Stock of such Subsidiary (other than directors'
qualifying shares) to any Person other than the Company or
one or more Wholly Owned Subsidiaries of the Company.
Following the Closing, the Company shall not, and shall not
permit any of its Subsidiaries to, sell, transfer or
otherwise dispose of any shares of Capital Stock of any of
its Subsidiaries that accounts for 5% or more of
Consolidated Net Income for the period of the most recent
four consecutive fiscal quarters ended prior to the date of
determination hereunder for which financial statements have
been filed with the SEC pursuant to this Indenture to any
Person (other than to the Company or a Wholly Owned
Subsidiary of the Company) unless, at the time of such sale,
transfer or other disposition, all such shares of such
Subsidiary then owned by the Company and its Subsidiaries
are so sold, transferred or otherwise disposed of (it being
agreed that any transfer of such Capital Stock in connection
with the exercise of remedies under any pledge agreement
securing Bank Indebtedness shall not be prohibited by this
sentence).
ARTICLE 5
SUCCESSOR COMPANY
SECTION 5.01. When Company May Merge or
Transfer Assets. (a) At any time while the Permitted
Holders beneficially own (i) in the aggregate, at least 33%
of the Total Voting Power in Hexcel (as defined in the
Governance Agreement and determined in accordance with
Section 2.02(e) thereof) and (ii) any Securities, the
Company may consolidate with or merge with or into, or
convey, transfer or lease, in one transaction or a series of
transactions, all or substantially all its assets to, any
Person if the resulting, surviving or transferee Person
shall be a corporation organized and existing under the laws
of the United States, any State thereof or the District of
Columbia and, if other than the Company, shall expressly
assume, by a supplemental indenture, executed and delivered
to the Trustee, in form reasonably satisfactory to the
Trustee, all the obligations of the Company under the
Securities and this Indenture. Any consolidation, merger,
conveyance, transfer or lease that is subject to the
provisions of this Section 5.01(a) shall not be subject to
the provisions of Section 5.01(b).
(b) At any time when the Permitted Holders do
not beneficially own either (1) in the aggregate, at least
33% of the Total Voting Power in Hexcel (as defined in the
Governance Agreement and determined in accordance with
Section 2.02(e) thereof) or (2) any Securities, the Company
shall not consolidate with or merge with or into, or convey,
transfer or lease, in one transaction or a series of
transactions, all or substantially all its assets to, any
Person, unless: (i) the resulting, surviving or transferee
Person (the Company or any such resulting, surviving or
transferee Person, as the case may be, being herein called
the "Successor Company") shall be a corporation organized
and existing under the laws of the United States of America,
any State thereof or the District of Columbia and the
Successor Company (if not the Company) shall expressly
assume, by an indenture supplemental hereto, executed and
delivered to the Trustee, in form satisfactory to the
Trustee, all the obligations of the Company under the
Securities and this Indenture, (ii) immediately after giving
effect to such transaction on a pro forma basis (and
treating any Indebtedness which becomes an obligation of the
Successor Company or any Subsidiary as a result of such
transaction as having been Incurred by the Successor Company
or such Subsidiary at the time of such transaction), no
Default shall have occurred and be continuing;
(iii) immediately after giving effect to such transaction on
a pro forma basis (and treating any Indebtedness which
becomes an obligation of the Successor Company or any
Subsidiary as a result of such transaction as having been
Incurred by the Successor Company or such Subsidiary at the
time of such transaction), the Successor Company could Incur
an additional $1.00 of Indebtedness pursuant to
Section 4.03(a); (iv) immediately after giving effect to
such transaction on a pro forma basis (and treating any
Indebtedness which becomes an obligation of the Successor
Company or any Subsidiary as a result of such transaction as
having been Incurred by the Successor Company or such
Subsidiary at the time of such transaction), the Successor
Company shall have Consolidated Net Worth in an amount which
is not less than the Consolidated Net Worth of the Company
immediately prior to such transaction and (v) the Company
shall have delivered to the Trustee an Officers' Certificate
and an Opinion of Counsel, each stating that such
consolidation, merger or transfer and such supplemental
indenture (if any) comply with this Indenture.
Notwithstanding clause (ii) above, any Wholly
Owned Subsidiary may consolidate with, merge into or
transfer all or part of its properties and assets to the
Company.
(c) The Successor Company under this Article 5
shall be the successor to the Company and shall succeed to,
and be substituted for, and may exercise every right and
power of, the Company under this Indenture, but the
predecessor Company in the case of a conveyance, transfer or
lease shall not be released from the obligation to pay the
principal of and interest on the Securities.
ARTICLE 6
DEFAULTS AND REMEDIES
SECTION 6.01. Events of Default. An "Event of
Default" occurs if:
(1) the Company fails to make any payment of
interest on any Security when the same becomes due
and payable, whether or not such payment shall be
prohibited by Article 10, and such failure
continues for a period of 30 days;
(2) the Company (i) fails to make the payment
of the principal of any Security when the same
becomes due and payable at its Stated Maturity,
upon redemption, upon declaration, or otherwise,
whether or not such payment shall be prohibited by
Article 10 or (ii) fails to redeem or purchase
Securities when required pursuant to this
Indenture or the Securities, whether or not such
redemption or purchase shall be prohibited by
Article 10;
(3) the Company fails to comply with
Section 5.01;
(4) the Company fails to comply with
Section 4.02, 4.03, 4.04, 4.05, 4.06, 4.07, 4.08
or 4.11 (other than a failure to purchase
Securities when required under Section 4.06 or
4.08) and such failure continues for 30 days after
the Notice of Default specified below;
(5) the Company fails to comply with any of its
agreements in the Securities or this Indenture
(other than those referred to in (1), (2), (3) or
(4) above) and such failure continues for 60 days
after the Notice of Default specified below;
(6) Indebtedness of the Company or any
Subsidiary is not paid within any applicable grace
period after final maturity or is accelerated by
the holders thereof, the total amount of such
Indebtedness unpaid or accelerated exceeds
$10,000,000 or its Dollar Equivalent at the time
and such default or acceleration continues for 10
days after the Notice of Default specified below;
(7) the Company or any Significant Subsidiary
pursuant to or within the meaning of any
Bankruptcy Law:
(A) commences a voluntary case;
(B) consents to the entry of an order for
relief against it in an involuntary case;
(C) consents to the appointment of a Custodian
of it or for any substantial part of its
property; or
(D) makes a general assignment for the benefit
of its creditors;
or takes any comparable action under any
foreign laws relating to insolvency;
(8) a court of competent jurisdiction enters an
order or decree under any Bankruptcy Law that:
(A) is for relief against the Company or any
Significant Subsidiary in an involuntary case;
(B) appoints a Custodian of the Company or any
Significant Subsidiary or for any substantial
part of its property; or
(C) orders the winding up or liquidation of the
Company or any Significant Subsidiary;
or any similar relief is granted under any
foreign laws and the order or decree remains
unstayed and in effect for 60 days; or
(9) any judgment or decree for the payment of
money in excess of $10,000,000 or its Dollar
Equivalent in excess of applicable insurance
coverage at the time is entered against the
Company or any Significant Subsidiary and is not
discharged and there is a period of 60 days
following the entry of such judgment or decree
during which such judgment or decree is not
discharged, waived or the execution thereof
stayed.
Each of the foregoing will constitute an Event
of Default whatever the reason for any such Event of Default
and whether it is voluntary or involuntary or is effected by
operation of law or pursuant to any judgment, decree or
order of any court or any order, rule or regulation of any
administrative or governmental body.
The term "Bankruptcy Law" means Title 11,
United States Code, or any similar Federal or state law for
the relief of debtors. The term "Custodian" means any
receiver, trustee, assignee, liquidator, custodian or
similar official under any Bankruptcy Law.
A Default under clause (4), (5) or (6) is not
an Event of Default until either (i) the Trustee or
(ii)(a) so long as the Permitted Holders beneficially own,
in the aggregate, at least 50% of the outstanding principal
amount of the Securities, Ciba or (b) in the event the
Permitted Holders beneficially own, in the aggregate, less
than 50% of the outstanding principal amount of the
Securities, the Holders of at least 25% in principal amount
of the Securities notify the Company of the Default and the
Company does not cure such Default within the time specified
after receipt of such notice. Such notice must specify the
Default, demand that it be remedied and state that such
notice is a "Notice of Default".
The Company shall deliver to the Trustee,
within 30 days after the occurrence thereof, written notice
in the form of an Officers' Certificate of any event which
with the giving of notice and the lapse of time would become
an Event of Default under clause (4), (5), (6) or (9), its
status and what action the Company is taking or proposes to
take with respect thereto.
SECTION 6.02. Acceleration. If an Event of
Default (other than an Event of Default specified in
Section 6.01(7) or (8) with respect to the Company) occurs
and is continuing, the Trustee by notice to the Company, or
Ciba or the Holders of at least 25% in principal amount of
the Securities, as applicable, by notice to the Company and
the Trustee, may declare the principal of and accrued
interest on all the Securities to be due and payable. Upon
such a declaration, such principal and interest shall be due
and payable immediately. If an Event of Default specified
in Section 6.01(7) or (8) with respect to the Company
occurs, the principal of and interest on all the Securities
shall ipso facto become and be immediately due and payable
without any declaration or other act on the part of the
Trustee or any Securityholders. The Holders of a majority
in principal amount of the Securities by notice to the
Trustee may rescind an acceleration and its consequences if
the rescission would not conflict with any judgment or
decree and if all existing Events of Default have been cured
or waived except nonpayment of principal or interest that
has become due solely because of acceleration. No such
rescission shall affect any subsequent Default or impair any
right consequent thereto.
SECTION 6.03. Other Remedies. If an Event of
Default occurs and is continuing, the Trustee may pursue any
available remedy to collect the payment of principal of or
interest on the Securities or to enforce the performance of
any provision of the Securities or this Indenture.
The Trustee may maintain a proceeding even if
it does not possess any of the Securities or does not
produce any of them in the proceeding. A delay or omission
by the Trustee or any Securityholder in exercising any right
or remedy accruing upon an Event of Default shall not impair
the right or remedy or constitute a waiver of or
acquiescence in the Event of Default. No remedy is
exclusive of any other remedy. All available remedies are
cumulative.
SECTION 6.04. Waiver of Past Defaults. The
Holders of a majority in principal amount of the Securities
by notice to the Trustee may waive an existing Default and
its consequences except (i) a Default in the payment of the
principal of or interest on a Security or (ii) a Default in
respect of a provision that under Section 9.02 cannot be
amended without the consent of each Securityholder affected.
When a Default is waived, it is deemed cured, but no such
waiver shall extend to any subsequent or other Default or
impair any right arising from such subsequent or other
Default.
SECTION 6.05. Control by Majority. The
Holders of a majority in principal amount of the Securities
may direct the time, method and place of conducting any
proceeding for any remedy available to the Trustee or of
exercising any trust or power conferred on the Trustee.
However, the Trustee may refuse to follow any direction that
(i) conflicts with law or this Indenture, (ii) or, subject
to Section 7.01, that the Trustee determines is unduly
prejudicial to the rights of other Securityholders or
(iii) would involve the Trustee in personal liability;
provided, however, that the Trustee may take any other
action deemed proper by the Trustee that is not inconsistent
with such direction. Prior to taking any action hereunder,
the Trustee shall be entitled to indemnification
satisfactory to it in its sole discretion against all losses
and expenses caused by taking or not taking such action.
SECTION 6.06. Limitation on Suits. A
Securityholder may not pursue any remedy with respect to
this Indenture or the Securities unless:
(1) the Holder gives to the Trustee written
notice stating that an Event of Default is
continuing;
(2) the Holders of at least 25% in principal
amount of the Securities make a written request to
the Trustee to pursue the remedy;
(3) such Holder or Holders offer to the Trustee
reasonable security or indemnity against any loss,
liability or expense;
(4) the Trustee does not comply with the
request within 60 days after receipt of the
request and the offer of security or indemnity;
and
(5) the Holders of a majority in principal
amount of the Securities do not give the Trustee a
direction inconsistent with the request during
such 60-day period.
A Securityholder may not use this Indenture to
prejudice the rights of another Securityholder or to obtain
a preference or priority over another Securityholder.
SECTION 6.07. Rights of Holders To Receive
Payment. Notwithstanding any other provision of this
Indenture, the right of any Holder to receive payment of
principal of and interest on the Securities held by such
Holder, on or after the respective due dates expressed in
the Securities, or to bring suit for the enforcement of any
such payment on or after such respective dates, shall not be
impaired or affected without the consent of such Holder.
SECTION 6.08. Collection Suit by Trustee. If
an Event of Default in payment of interest or principal
specified in Section 6.01(1) or (2) occurs and is
continuing, the Trustee may recover judgment in its own name
and as trustee of an express trust against the Company for
the whole amount of principal and interest remaining unpaid
(together with interest on such unpaid interest to the
extent lawful) and the amounts provided for in Section 7.07.
SECTION 6.09. Trustee May File Proofs of
Claim. The Trustee may file such proofs of claim and other
papers or documents as may be necessary or advisable in
order to have the claims of the Trustee and the
Securityholders allowed in any receivership, insolvency,
liquidation, bankruptcy, reorganization, arrangement,
adjustment, composition or other judicial proceedings
relative to the Company, its creditors or its property and,
unless prohibited by law or applicable regulations, may vote
on behalf of the Holders in any election of a trustee in
bankruptcy or other Person performing similar functions, and
any Custodian in any such judicial proceeding is hereby
authorized by each Holder to make payments to the Trustee
and, in the event that the Trustee shall consent to the
making of such payments directly to the Holders, to pay to
the Trustee any amount due it for the reasonable
compensation, expenses, disbursements and advances of the
Trustee, its agents and its counsel, and any other amounts
due the Trustee under Section 7.07.
SECTION 6.10. Priorities. If the Trustee
collects any money or property pursuant to this Article 6,
it shall pay out the money or property in the following
order:
FIRST: to the Trustee for amounts due under
Section 7.07;
SECOND: to holders of Senior Indebtedness to
the extent required by Article 10;
THIRD: to Securityholders for amounts due and
unpaid on the Securities for principal and
interest, ratably, without preference or priority
of any kind, according to the amounts due and
payable on the Securities for principal and
interest, respectively; and
FOURTH: to the Company.
The Trustee may fix a record date and payment
date for any payment to Securityholders pursuant to this
Section. At least 15 days before such record date, the
Company shall mail to each Securityholder and the Trustee a
notice that states the record date, the payment date and
amount to be paid.
SECTION 6.11. Undertaking for Costs. In any
suit for the enforcement of any right or remedy under this
Indenture or in any suit against the Trustee for any action
taken or omitted by it as Trustee, a court in its discretion
may require the filing by any party litigant in the suit of
an undertaking to pay the costs of the suit, and the court
in its discretion may assess reasonable costs, including
reasonable attorneys' fees, against any party litigant in
the suit, having due regard to the merits and good faith of
the claims or defenses made by the party litigant. This
Section does not apply to a suit by the Trustee, a suit by a
Holder pursuant to Section 6.07 or a suit by Holders of more
than 10% in principal amount of the Securities.
SECTION 6.12. Waiver of Stay or Extension
Laws. The Company (to the extent it may lawfully refrain
from doing so) shall not at any time insist upon, or plead,
or in any manner whatsoever claim or take the benefit or
advantage of, any stay or extension law wherever enacted,
now or at any time hereafter in force, which may affect the
covenants or the performance of this Indenture; and the
Company (to the extent that it may lawfully do so) hereby
expressly waives all benefit or advantage of any such law,
and shall not hinder, delay or impede the execution of any
power herein granted to the Trustee, but shall suffer and
permit the execution of every such power as though no such
law had been enacted.
ARTICLE 7
TRUSTEE
SECTION 7.01. Duties of Trustee. (a) If an
Event of Default has occurred and is continuing, the Trustee
shall exercise the rights and powers vested in it by this
Indenture and use the same degree of care and skill in their
exercise as a prudent Person would exercise or use under the
circumstances in the conduct of such Person's own affairs.
(b) Except during the continuance of an Event
of Default:
(1) the Trustee undertakes to perform such
duties and only such duties as are specifically
set forth in this Indenture and no implied
covenants or obligations shall be read into this
Indenture against the Trustee; and
(2) in the absence of bad faith on its part,
the Trustee may conclusively rely, as to the truth
of the statements and the correctness of the
opinions expressed therein, upon certificates or
opinions furnished to the Trustee and conforming
to the requirements of this Indenture. However,
the Trustee shall examine the certificates and
opinions to determine whether or not they conform
to the requirements of this Indenture.
(c) The Trustee may not be relieved from
liability for its own negligent action, its own negligent
failure to act or its own wilful misconduct, except that:
(1) this paragraph does not limit the effect of
paragraph (b) of this Section 7.01;
(2) the Trustee shall not be liable for any
error of judgment made in good faith by a Trust
Officer unless it is proved that the Trustee was
negligent in ascertaining the pertinent facts; and
(3) the Trustee shall not be liable with
respect to any action it takes or omits to take in
good faith in accordance with a direction received
by it pursuant to Section 6.05.
(d) Every provision of this Indenture that in
any way relates to the Trustee is subject to paragraphs (a),
(b) and (c) of this Section.
(e) The Trustee shall not be liable for
interest on any money received by it except as the Trustee
may agree in writing with the Company.
(f) Money held in trust by the Trustee need
not be segregated from other funds except to the extent
required by law.
(g) No provision of this Indenture shall
require the Trustee to expend or risk its own funds or
otherwise incur financial liability in the performance of
any of its duties hereunder or in the exercise of any of its
rights or powers, if it shall have reasonable grounds to
believe that repayment of such funds or adequate indemnity
against such risk or liability is not reasonably assured to
it.
(h) Every provision of this Indenture relating
to the conduct or affecting the liability of or affording
protection to the Trustee shall be subject to the provisions
of this Section and to the provisions of the TIA.
SECTION 7.02. Rights of Trustee. (a) The
Trustee may rely on any document believed by it to be
genuine and to have been signed or presented by the proper
person. The Trustee need not investigate any fact or matter
stated in the document.
(b) Before the Trustee acts or refrains from
acting, it may require an Officers' Certificate or an
Opinion of Counsel. The Trustee shall not be liable for any
action it takes or omits to take in good faith in reliance
on the Officers' Certificate or Opinion of Counsel.
(c) The Trustee may act through agents and
shall not be responsible for the misconduct or negligence of
any agent appointed with due care.
(d) The Trustee shall not be liable for any
action it takes or omits to take in good faith which it
believes to be authorized or within its rights or powers;
provided, however, that the Trustee's conduct does not
constitute wilful misconduct or negligence.
(e) The Trustee may consult with counsel, and
the advice or opinion of counsel with respect to legal
matters relating to this Indenture and the Securities shall
be full and complete authorization and protection from
liability in respect to any action taken, omitted or
suffered by it hereunder in good faith and in accordance
with the advice or opinion of such counsel.
SECTION 7.03. Individual Rights of Trustee.
The Trustee in its individual or any other capacity may
become the owner or pledgee of Securities and may otherwise
deal with the Company or its Affiliates with the same rights
it would have if it were not Trustee. Any Paying Agent,
Registrar, co-registrar or co-paying agent may do the same
with like rights. However, the Trustee must comply with
Sections 7.10 and 7.11.
SECTION 7.04. Trustee's Disclaimer. The
Trustee shall not be responsible for and makes no
representation as to the validity or adequacy of this
Indenture or the Securities, it shall not be accountable for
the Company's use of the proceeds from the Securities, and
it shall not be responsible for any statement of the Company
in the Indenture or in any document issued in connection
with the sale of the Securities or in the Securities other
than the Trustee's certificate of authentication.
SECTION 7.05. Notice of Defaults. If a
Default occurs and is continuing and if it is known to the
Trustee, the Trustee shall mail to each Securityholder
notice of the Default within 90 days after it occurs.
Except in the case of a Default in payment of principal of
or interest on any Security, the Trustee may withhold the
notice if and so long as a committee of its Trust Officers
in good faith determines that withholding the notice is in
the interests of Securityholders.
SECTION 7.06. Reports by Trustee to Holders.
As promptly as practicable after each May 15 beginning with
the May 15 following the date of this Indenture, the Trustee
shall mail to each Securityholder a brief report dated as of
such May 15 that complies with TIA 313(a). The Trustee also
shall comply with TIA SECTIONSECTION 313(b) and 313(c).
A copy of each report at the time of its
mailing to Securityholders shall be filed with the SEC and
each stock exchange (if any) on which the Securities are
listed. The Company agrees to notify promptly the Trustee
whenever the Securities become listed on any stock exchange
and of any delisting thereof.
SECTION 7.07. Compensation and Indemnity. The
Company shall pay to the Trustee from time to time
reasonable compensation for its services. The Trustee's
compensation shall not be limited by any law on compensation
of a trustee of an express trust. The Company shall
reimburse the Trustee upon request for all reasonable out-
of-pocket expenses incurred or made by it, including costs
of collection, in addition to the compensation for its
services. Such expenses shall include the reasonable
compensation and expenses, disbursements and advances of the
Trustee's agents, counsel, accountants and experts. The
Company shall indemnify the Trustee against any and all
loss, liability or expense (including attorneys' fees)
incurred by it in connection with the administration of this
trust and the performance of its duties hereunder. The
Trustee shall notify the Company promptly of any claim for
which it may seek indemnity. Failure by the Trustee to so
notify the Company shall not relieve the Company of its
obligations hereunder. The Company shall defend the claim
and the Trustee shall provide reasonable cooperation at the
Company's expense in the defense. The Trustee may have
separate counsel and the Company shall pay the fees and
expenses of such counsel; provided, that the Company will
not be required to pay such fees and expenses if it assumes
the Trustee's defense and there is no conflict of interest
between the Company and the Trustee in connection with such
defense. The Company need not pay for any settlement made
without its written consent. The Company need not reimburse
any expense or indemnify against any loss, liability or
expense incurred by the Trustee through the Trustee's own
wilful misconduct, negligence or bad faith.
To secure the Company's payment obligations in
this Section 7.07, the Trustee shall have a Lien prior to
the Securities on all money or property held or collected by
the Trustee other than money or property held in trust to
pay principal of and interest on particular Securities.
The Company's payment obligations pursuant to
this Section 7.07 shall survive the discharge of this
Indenture. When the Trustee incurs expenses after the
occurrence of a Default specified in Section 6.01(7) or (8)
with respect to the Company, the expenses are intended to
constitute expenses of administration under Bankruptcy Law.
SECTION 7.08. Replacement of Trustee. The
Trustee may resign at any time by so notifying the Company
in writing. The Holders of a majority in principal amount
of the Securities may remove the Trustee by so notifying the
Trustee in writing and may appoint a successor Trustee with
the Company's consent (which shall not be unreasonably
withheld). The Company shall remove the Trustee if:
(1) the Trustee fails to comply with Section
7.10;
(2) the Trustee is adjudged bankrupt or
insolvent or an order for relief is entered with
respect to the Trustee under any Bankruptcy Law;
(3) a receiver or other public officer takes
charge of the Trustee or its property; or
(4) the Trustee otherwise becomes incapable of
acting.
If the Trustee resigns or is removed or if a
vacancy exists in the office of Trustee for any reason (the
Trustee in such event being referred to herein as the
retiring Trustee), the Company shall promptly appoint a
successor Trustee.
A successor Trustee shall deliver a written
acceptance of its appointment to the retiring Trustee and to
the Company. Thereupon the resignation or removal of the
retiring Trustee shall become effective, and the successor
Trustee shall have all the rights, powers and duties of the
Trustee under this Indenture. The successor Trustee shall
mail a notice of its succession to Securityholders. The
retiring Trustee shall promptly transfer all property held
by it as Trustee to the successor Trustee, subject to the
lien provided for in Section 7.07.
If a successor Trustee does not take office
within 60 days after the retiring Trustee resigns or is
removed, the retiring Trustee or the Holders of at least 10%
in aggregate in principal amount of the Securities may
petition any court of competent jurisdiction for the
appointment of a successor Trustee.
If the Trustee fails to comply with Section
7.10, any Securityholder may petition any court of competent
jurisdiction for the removal of the Trustee and the
appointment of a successor Trustee.
Notwithstanding the replacement of the Trustee
pursuant to this Section 7.08, the Company's obligations
under Section 7.07 shall continue for the benefit of the
retiring Trustee.
SECTION 7.09. Successor Trustee by Merger. If
the Trustee consolidates with, merges or converts into, or
transfers all or substantially all its corporate trust
business or assets to, another corporation or banking
association, the resulting, surviving or transferee
corporation or banking association without any further act
shall be the successor Trustee.
In case at the time such successor or
successors by merger, conversion or consolidation to the
Trustee shall succeed to the trusts created by this
Indenture any of the Securities shall have been
authenticated but not delivered, any such successor to the
Trustee may adopt the certificate of authentication of any
predecessor trustee, and deliver such Securities so
authenticated; and in case at that time any of the
Securities shall not have been authenticated, any successor
to the Trustee may authenticate such Securities either in
the name of any predecessor hereunder or in the name of the
successor to the Trustee; and in all such cases such
certificates shall have the full force which it is anywhere
in the Securities or in this Indenture provided that the
certificate of the Trustee shall have.
SECTION 7.10. Eligibility; Disqualification.
The Trustee shall at all times satisfy the requirements of
TIA SECTION 310(a). The Trustee shall have a combined capital and
surplus of at least $50,000,000 as set forth in its most
recent published annual report of condition. The Trustee
shall comply with TIA SECTION 310(b); provided, however, that
there shall be excluded from the operation of
TIA SECTION 310(b)(1) any indenture or indentures under which
other securities or certificates of interest or
participation in other securities of the Company are
outstanding if the requirements for such exclusion set forth
in TIA SECTION 310(b)(1) are met.
SECTION 7.11. Preferential Collection of
Claims Against Company. The Trustee shall comply with TIA
SECTION 311(a), excluding any creditor relationship listed in TIA
SECTION 311(b). A Trustee who has resigned or been removed shall
be subject to TIA SECTION 311(a) to the extent indicated.
ARTICLE 8
DISCHARGE OF INDENTURE; DEFEASANCE
SECTION 8.01. Discharge of Liability on
Securities; Defeasance. (a) When (i) the Company delivers
to the Trustee all outstanding Securities (other than
Securities replaced pursuant to Section 2.07) for
cancellation or (ii) all outstanding Securities have become
due and payable, whether at maturity or as a result of the
mailing of a notice of redemption pursuant to Article 3
hereof, and the Company irrevocably deposits with the
Trustee funds sufficient to pay at maturity or upon
redemption all outstanding Securities, including interest
thereon (other than Securities replaced pursuant to Section
2.07), and if in either case the Company pays all other sums
payable hereunder by the Company, then this Indenture shall,
subject to Sections 8.01(c) and 8.06, cease to be of further
effect. The Trustee shall acknowledge satisfaction and
discharge of this Indenture on demand of the Company
accompanied by an Officers' Certificate and an Opinion of
Counsel and at the cost and expense of the Company.
(b) Subject to Sections 8.01(c), 8.02 and
8.06, the Company at any time may terminate (i) all its
obligations under the Securities and this Indenture ("legal
defeasance option") or (ii) its obligations under
Sections 4.03, 4.04, 4.05, 4.06, 4.07, 4.08, 4.11 and
5.01(iii) and (iv) and the operation of Section 6.01(6),
Sections 6.01(7) and 6.01(8) (to the extent applicable to
Subsidiaries) and Section 6.09 ("covenant defeasance
option"). The Company may exercise its legal defeasance
option notwithstanding its prior exercise of its covenant
defeasance option.
If the Company exercises its legal defeasance
option, payment of the Securities may not be accelerated
because of an Event of Default. If the Company exercises
its covenant defeasance option, payment of the Securities
may not be accelerated because of an Event of Default
specified in Section 6.01(3) (to the extent specified in the
preceding paragraph), Section 6.01(4) (to the extent
specified in the preceding paragraph), Section 6.01(6) (to
the extent specified in the preceding paragraph),
Section 6.01(6), Sections 6.01(7) and 6.01(8) (to the extent
applicable to Subsidiaries) or Section 6.01(9) or because of
the failure of the Company to comply with Sections 5.01(iii)
and 5.01(iv).
Upon satisfaction of the conditions set forth
herein and upon request of the Company, the Trustee shall
acknowledge in writing the discharge of those obligations
that the Company terminates.
(c) Notwithstanding clauses (a) and (b) above,
the Company's obligations in Sections 2.03, 2.04, 2.05,
2.06, 2.07, 7.07, 7.08, 8.04, 8.05 and 8.06 shall survive
until the Securities have been paid in full. Thereafter,
the Company's obligations in Sections 7.07, 8.04 and 8.05
shall survive.
SECTION 8.02. Conditions to Defeasance. The
Company may exercise its legal defeasance option or its
covenant defeasance option only if:
(1) the Company irrevocably deposits in trust
with the Trustee money or U.S. Government
Obligations for the payment of principal and
interest on the Securities to maturity or
redemption, as the case may be;
(2) the Company delivers to the Trustee a
certificate from a nationally recognized firm of
independent accountants expressing their opinion
that the payments of principal and interest when
due and without reinvestment on the deposited U.S.
Government Obligations plus any deposited money
without investment will provide cash at such times
and in such amounts as will be sufficient to pay
principal and interest when due on all the
Securities to maturity or redemption, as the case
may be;
(3) 123 days pass after the deposit is made and
during the 123-day period no Default specified in
Section 6.01(7) or (8) with respect to the Company
occurs which is continuing at the end of the
period;
(4) the deposit does not constitute a default
under any other agreement binding on the Company
and is not prohibited by Article 10;
(5) the Company delivers to the Trustee an
Opinion of Counsel to the effect that the trust
resulting from the deposit does not constitute, or
is qualified as, a regulated investment company
under the Investment Company Act of 1940;
(6) in the case of the legal defeasance option,
the Company shall have delivered to the Trustee an
Opinion of Counsel stating that (i) the Company
has received from the Internal Revenue Service a
ruling, or (ii) since the date of this Indenture
there has been a change in the applicable Federal
income tax law, in either case to the effect that,
and based thereon such Opinion of Counsel shall
confirm that, the Securityholders will not
recognize income, gain or loss for Federal income
tax purposes as a result of such defeasance and
will be subject to Federal income tax on the same
amounts, in the same manner and at the same times
as would have been the case if such defeasance had
not occurred;
(7) in the case of the covenant defeasance
option, the Company shall have delivered to the
Trustee an Opinion of Counsel to the effect that
the Securityholders will not recognize income,
gain or loss for Federal income tax purposes as a
result of such covenant defeasance and will be
subject to Federal income tax on the same amounts,
in the same manner and at the same times as would
have been the case if such covenant defeasance had
not occurred; and
(8) the Company delivers to the Trustee an
Officers' Certificate and an Opinion of Counsel,
each stating that all conditions precedent to the
defeasance and discharge of the Securities as
contemplated by this Article 8 have been complied
with.
Before or after a deposit, the Company may make
arrangements satisfactory to the Trustee for the redemption
of Securities at a future date in accordance with Article 3.
SECTION 8.03. Application of Trust Money. The
Trustee shall hold in trust money or U.S. Government
Obligations deposited with it pursuant to this Article 8.
It shall apply the deposited money and the money from U.S.
Government Obligations through the Paying Agent and in
accordance with this Indenture to the payment of principal
of and interest on the Securities. Money and securities so
held in trust are not subject to Article 10.
SECTION 8.04. Repayment to Company. The
Trustee and the Paying Agent shall promptly turn over to the
Company upon request any excess money or securities held by
them at any time.
Subject to any applicable abandoned property
law, the Trustee and the Paying Agent shall pay to the
Company upon request any money held by them for the payment
of principal or interest that remains unclaimed for two
years after such principal or interest has become due and
payable, and, thereafter, Securityholders entitled to the
money must look to the Company for payment as general
creditors.
SECTION 8.05. Indemnity for Government
Obligations. The Company shall pay and shall indemnify the
Trustee against any tax, fee or other charge imposed on or
assessed against deposited U.S. Government Obligations or
the principal and interest received on such U.S. Government
Obligations other than any such tax, fee or other charge
that by law is for the account of the Holders.
SECTION 8.06. Reinstatement. If the Trustee
or Paying Agent is unable to apply any money or U.S.
Government Obligations in accordance with this Article 8 by
reason of any legal proceeding or by reason of any order or
judgment of any court or governmental authority enjoining,
restraining or otherwise prohibiting such application, the
Company's obligations under this Indenture and the
Securities shall be revived and reinstated as though no
deposit had occurred pursuant to this Article 8 until such
time as the Trustee or Paying Agent is permitted to apply
all such money or U.S. Government Obligations in accordance
with this Article 8; provided, however, that if the Company
makes any payment of principal of or interest on any
Security because of the reinstatement of its obligations,
the Company shall be subrogated to the rights of such
Securityholders to receive such payment from the money or
U.S. Government Obligations held by the Trustee or Paying
Agent.
ARTICLE 9
AMENDMENTS
SECTION 9.01. Without Consent of Holders. The
Company and the Trustee may amend this Indenture or the
Securities without notice to or consent of any
Securityholder:
(1) to cure any ambiguity, omission, defect or
inconsistency;
(2) to comply with Article 5;
(3) to provide for uncertificated Securities in
addition to or in place of certificated
Securities; provided, however, that the
uncertificated Securities are issued in registered
form for purposes of Section 163(f) of the Code or
in a manner such that the uncertificated
Securities are described in Section 163(f)(2)(B)
of the Code;
(4) to make any change in Article 10 that would
limit or terminate the benefits available to any
holder of Senior Indebtedness (or Representatives
therefor) under Article 10;
(5) to add guarantees with respect to the
Securities or to secure the Securities;
(6) to add to the covenants of the Company for
the benefit of the Holders or to surrender any
right or power herein conferred upon the Company;
(7) to comply with the TIA; or
(8) to make any change that does not adversely
affect the rights of any Securityholder.
An amendment under this Section may not make any
change that adversely affects the rights under Article 10 of
any holder of Senior Indebtedness then outstanding unless
the holders of such Senior Indebtedness (or any group or
representative thereof authorized to give a consent) consent
to such change.
After an amendment under this Section 9.01
becomes effective, the Company shall mail to Securityholders
a notice briefly describing such amendment. The failure to
give such notice to all Securityholders, or any defect
therein, shall not impair or affect the validity of an
amendment under this Section.
SECTION 9.02. With Consent of Holders. The
Company and the Trustee may amend this Indenture or the
Securities or waive any provision thereof without notice to
any Securityholder but with the written consent of the
Holders of at least a majority in principal amount of the
Securities. However, without the consent of each
Securityholder affected, an amendment or waiver may not:
(1) reduce the amount of Securities whose
Holders must consent to an amendment or waiver;
(2) reduce the rate of or extend the time for
payment of interest on any Security;
(3) reduce the principal of or extend the
Stated Maturity of any Security;
(4) change the time at which any Security may
or shall be redeemed in accordance with Article 3;
(5) make any Security payable in money other
than that stated in the Security;
(6) make any change in Article 10 that
adversely affects the rights of any Securityholder
under Article 10; or
(7) make any change in Section 6.04 or 6.07 or
the second sentence of this Section.
It shall not be necessary for the consent of
the Holders under this Section to approve the particular
form of any proposed amendment, but it shall be sufficient
if such consent approves the substance thereof.
An amendment or waiver under this Section may
not make any change that adversely affects the rights under
Article 10 of any holder of Senior Indebtedness then
outstanding unless the holders of such Senior Indebtedness
(or any group or representative thereof authorized to give a
consent) consent to such change.
After an amendment or waiver under this
Section 9.02 becomes effective, the Company shall mail to
Securityholders a notice briefly describing such amendment.
The failure to give such notice to all Securityholders, or
any defect therein, shall not impair or affect the validity
of such amendment or waiver.
SECTION 9.03. Compliance with Trust Indenture
Act. Every amendment to this Indenture or the Securities
shall comply with the TIA as then in effect.
SECTION 9.04. Revocation and Effect of
Consents and Waivers. A consent to an amendment or a waiver
by a Holder of a Security shall bind the Holder and every
subsequent Holder of that Security or portion of the
Security that evidences the same debt as the consenting
Holder's Security, even if notation of the consent or waiver
is not made on the Security. However, any such Holder or
subsequent Holder may revoke the consent or waiver as to
such Holder's Security or portion of the Security by written
notice of revocation to the Company or the Person designated
by the Company as the person to whom consents should be sent
if such revocation is received by the Company or such Person
before the date on which the Trustee receives an Officers'
Certificate certifying that the Holders of the requisite
principal amount of Securities have consented (and not
theretofore revoked such consent) to the amendment or
waiver. After an amendment or waiver becomes effective, it
shall bind every Securityholder, unless it makes a change
described in any of clauses (1) through (7) of Section 9.02,
in which case the amendment, supplemental indenture or
waiver shall bind only each Holder of a Security who has
consented to it and every subsequent Holder of a Security or
portion of a Security that evidences the same debt as the
consenting Holder's Security.
The Company may, but shall not be obligated to,
fix a record date for the purpose of determining the
Securityholders entitled to give their consent or take any
other action described above or required or permitted to be
taken pursuant to this Indenture. If a record date is
fixed, then notwithstanding the immediately preceding
paragraph, those Persons who were Securityholders at such
record date (or their duly designated proxies), and only
those Persons, shall be entitled to give such consent or to
revoke any consent previously given or to take any such
action, whether or not such Persons continue to be Holders
after such record date. No such consent shall be valid or
effective for more than 120 days after such record date.
SECTION 9.05. Notation on or Exchange of
Securities. If an amendment changes the terms of a
Security, the Trustee may require the Holder of the Security
to deliver it to the Trustee. The Trustee may place an
appropriate notation on the Security regarding the changed
terms and return it to the Holder. Alternatively, if the
Company or the Trustee so determines, the Company in
exchange for the Security shall issue and the Trustee shall
authenticate a new Security that reflects the changed terms.
Failure to make the appropriate notation or to issue a new
Security shall not affect the validity of such amendment.
SECTION 9.06. Trustee To Sign Amendments. The
Trustee shall sign any amendment authorized pursuant to this
Article 9 if the amendment does not adversely affect the
rights, duties, liabilities or immunities of the Trustee.
If it does, the Trustee may but need not sign it. In
signing such amendment the Trustee shall be entitled to
receive, and (subject to Section 7.01) shall be fully
protected in relying upon, an Officers' Certificate and an
Opinion of Counsel stating that such amendment is authorized
or permitted by this Indenture.
SECTION 9.07. Payment for Consent. Neither
the Company nor any Affiliate of the Company shall, directly
or indirectly, pay or cause to be paid any consideration,
whether by way of interest, fee or otherwise, to any Holder
for or as an inducement to any consent, waiver or amendment
of any of the terms or provisions of this Indenture or the
Securities unless such consideration is offered to be paid
to all Holders that so consent, waive or agree to amend in
the time frame set forth in solicitation documents relating
to such consent, waiver or agreement.
ARTICLE 10
SUBORDINATION
SECTION 10.01. Agreement To Subordinate. Each
Securityholder by accepting a Security agrees, that the
Indebtedness evidenced by the Securities, including, without
limitation, principal and interest on, and all other amounts
owing in respect of, such Securities is subordinated in
right of payment, to the extent and in the manner provided
in this Article 10, to the prior payment in full of all
Senior Indebtedness and that the subordination is for the
benefit of and enforceable by the holders of Senior
Indebtedness. The Securities shall in all respects rank
pari passu with all other Senior Subordinated Indebtedness
of the Company and only Indebtedness of the Company which is
Senior Indebtedness shall rank senior to the Securities in
accordance with the provisions set forth herein. All
provisions of this Article 10 shall be subject to
Section 10.12.
SECTION 10.02. Liquidation, Dissolution,
Bankruptcy. Upon any payment or distribution of the assets
of the Company to creditors upon any state, federal or
foreign proceeding for the total or partial liquidation or a
total or partial dissolution or winding up of the Company or
in a state, federal or foreign bankruptcy, reorganization,
insolvency, receivership, assignment for the benefit of
creditors or marshalling of assets or similar proceeding
relating to the Company or its property:
(1) subject to Section 10.02(2), holders of
Senior Indebtedness shall be entitled to receive
payment in full of the Senior Indebtedness
(including interest (if any) accruing at the
specified contract rate (including, without
limitation, any rate applicable upon default) on
or after the commencement of a proceeding in
bankruptcy, whether or not allowed as a claim
against the Company in a bankruptcy proceeding) in
cash, Cash Equivalents or on terms otherwise
acceptable to the holders of Senior Indebtedness
before Securityholders shall be entitled to
receive any cash payment of principal of or
interest on, or other amounts owing in respect of,
the Securities; and
(2) until the Senior Indebtedness is paid in
full, any distribution to which Securityholders
would be entitled but for this Article 10 shall be
made to holders of Senior Indebtedness as their
interests may appear, except that Securityholders
may receive shares of stock and any debt
securities that are subordinated to Senior
Indebtedness or any security distributed in any
such proceeding on account of any Senior
Indebtedness to at least the same extent as the
Securities are subordinated to the Senior
Indebtedness and do not provide for the payment of
principal prior to the Stated Maturity of all
Senior Indebtedness.
SECTION 10.03. Default on Senior Indebtedness.
The Company shall not pay the principal of or interest on,
or other amounts owing in respect of, the Securities or make
any deposit pursuant to Section 8.01 and shall not
repurchase, redeem or otherwise retire any Securities
(collectively, "pay the Securities") if (i) any Senior
Indebtedness is not paid when due (including at maturity) or
(ii) any other default on Senior Indebtedness occurs and the
maturity of such Senior Indebtedness is accelerated in
accordance with its terms unless, in either case, (x) the
default has been cured or waived and any such acceleration
has been rescinded or (y) such Senior Indebtedness has been
paid in full; provided, however, that the Company may pay
the Securities without regard to the foregoing if the
Company and the Trustee receive written notice approving
such payment from the Representatives of each issue of
Designated Senior Indebtedness. During the continuance of
any default (other than a default described in clause (i) or
(ii) of the preceding sentence) with respect to any Senior
Indebtedness pursuant to which the maturity thereof may be
accelerated immediately without further notice (except such
notice as may be required to effect such acceleration) or
the expiration of any applicable grace periods, the Company
may not pay the Securities for a period (a "Payment Blockage
Period") commencing upon the receipt by the Company and the
Trustee of written notice of such default from the
Representative of any Designated Senior Indebtedness
specifying an election to effect a Payment Blockage Period
(a "Blockage Notice") and ending 179 days thereafter (or
earlier if such Payment Blockage Period is terminated (i) by
written notice to the Trustee and the Company from the
Person or Persons who gave such Blockage Notice, (ii) by
repayment in full of such Senior Indebtedness or
(iii) because the default giving rise to such Blockage
Notice is no longer continuing). Notwithstanding the
provisions described in the immediately preceding sentence
(but subject to the provisions contained in the first
sentence of this Section), unless the holders of such Senior
Indebtedness or the Representative of such holders shall
have accelerated the maturity of such Senior Indebtedness,
the Company may resume payments on the Securities after such
Payment Blockage Period. Not more than one Blockage Notice
may be given in any consecutive 360-day period, irrespective
of the number of defaults with respect to any number of
issues of Senior Indebtedness during such period; provided,
however, that if any Blockage Notice within such 360-day
period is given by or on behalf of any holders of Designated
Senior Indebtedness (other than the Bank Indebtedness), the
Representative of the Bank Indebtedness may give another
Blockage Notice within such period; provided further,
however, that in no event may the total number of days
during which any Payment Blockage Period or Periods is in
effect exceed 179 days in the aggregate during any
360 consecutive day period. For purposes of this
Section 10.03, no default or event of default which existed
or was continuing on the date of the commencement of any
Payment Blockage Period with respect to the Senior
Indebtedness initiating such Payment Blockage Period shall
be, or be made, the basis of the commencement of a
subsequent Payment Blockage Period by the Representative of
such Senior Indebtedness, whether or not within a period of
360 consecutive days, unless such default or event of
default shall have been cured or waived for a period of not
less than 90 consecutive days.
SECTION 10.04. Acceleration of Payment of
Securities. If payment of the Securities is accelerated
because of an Event of Default, the Company or the Trustee
at the direction of the Company shall promptly notify the
holders of the Designated Senior Indebtedness (or their
Representatives) of the acceleration. If any Designated
Senior Indebtedness is outstanding, the Company may not pay
the Securities until five Business Days after such holders
or the representatives of the Designated Senior Indebtedness
receive notice of such acceleration and, thereafter, may pay
the Securities only if this Article 10 otherwise permits
payment at that time.
SECTION 10.05. When Distribution Must Be Paid
Over. If a distribution is made to the Trustee or any
Securityholder that, because of this Article 10, should not
have been made to them, the Person who receives such a
distribution shall hold it in trust for holders of Senior
Indebtedness and promptly pay it over to them ratably
according to the respective amounts of such Senior
Indebtedness held or represented by them; provided that the
Trustee shall not be under any duty to hold such
distribution in trust unless it has received notice that the
terms of Article X forbid such distribution.
SECTION 10.06. Subrogation. After all Senior
Indebtedness is paid in full and until the Securities are
paid in full, Securityholders shall be subrogated to the
rights of holders of Senior Indebtedness to receive
distributions applicable to Senior Indebtedness. A
distribution made under this Article 10 to holders of Senior
Indebtedness which otherwise would have been made to
Securityholders is not, as between the Company and
Securityholders, a payment by the Company on Senior
Indebtedness.
SECTION 10.07. Relative Rights. This Article
10 defines the relative rights of Securityholders and
holders of Senior Indebtedness. Nothing in this Indenture
shall:
(1) impair, as between the Company and the
Securityholders, the obligation of the Company,
which is absolute and unconditional, to pay
principal of and interest on the Securities in
accordance with their terms; or
(2) prevent the Trustee or any Securityholder
from exercising its available remedies upon a
Default, subject to the rights of holders of
Senior Indebtedness to receive distributions
otherwise payable to Securityholders.
SECTION 10.08. Subordination May Not Be
Impaired by Company. The right of any holder of Senior
Indebtedness to enforce the subordination of the
Indebtedness evidenced by the Securities shall not be
impaired by any act or failure to act by the Company or by
its failure to comply with this Indenture.
SECTION 10.09. Rights of Trustee and Paying
Agent. Notwithstanding Section 10.03, the Trustee or Paying
Agent may continue to make payments on the Securities and
shall not be charged with knowledge of the existence of
facts that would prohibit the making of any such payments
unless, not less than two Business Days prior to the date of
such payment, a Trust Officer of the Trustee receives notice
satisfactory to it that payments may not be made under this
Article 10. The Company, the Registrar or co-registrar, the
Paying Agent, a Representative or a holder of Senior
Indebtedness may give the notice; provided, however, that,
if an issue of Senior Indebtedness has a Representative,
only the Representative may give the notice.
The Trustee in its individual or any other
capacity may hold Senior Indebtedness with the same rights
it would have if it were not Trustee. The Registrar and co-
registrar and the Paying Agent may do the same with like
rights. The Trustee shall be entitled to all the rights set
forth in this Article 10 with respect to any Senior
Indebtedness which may at any time be held by it, to the
same extent as any other holder of Senior Indebtedness; and
nothing in Article 7 shall deprive the Trustee of any of its
rights as such holder. Nothing in this Article 10 shall
apply to claims of, or payments to, the Trustee under or
pursuant to Section 7.07.
SECTION 10.10. Distribution or Notice to
Representative. Whenever a distribution is to be made or a
notice given to holders of Senior Indebtedness, the
distribution may be made and the notice given to their
Representative (if any).
SECTION 10.11. Article 10 Not To Prevent
Events of Default or Limit Right To Accelerate. The failure
to make a payment pursuant to the Securities by reason of
any provision in this Article 10 shall not be construed as
preventing the occurrence of a Default. Nothing in this
Article 10 shall have any effect on the right of the
Securityholders or the Trustee to accelerate the maturity of
the Securities.
SECTION 10.12. Trust Moneys Not Subordinated.
Notwithstanding anything contained herein to the contrary,
payments from money or the proceeds of U.S. Government
Obligations held in trust under Article 8 by the Trustee for
the payment of principal of and interest on the Securities
shall not be subordinated to the prior payment of any Senior
Indebtedness or subject to the restrictions set forth in
this Article 10, and none of the Securityholders shall be
obligated to pay over any such amount to the Company or any
holder of Senior Indebtedness of the Company or any other
creditor of the Company.
SECTION 10.13. Trustee Entitled To Rely. Upon
any payment or distribution pursuant to this Article 10, the
Trustee and the Securityholders shall be entitled to rely
(i) upon any order or decree of a court of competent
jurisdiction in which any proceedings of the nature referred
to in Section 10.02 are pending, (ii) upon a certificate of
the liquidating trustee or agent or other Person making such
payment or distribution to the Trustee or to the
Securityholders or (iii) upon the Representatives for the
holders of Senior Indebtedness for the purpose of
ascertaining the Persons entitled to participate in such
payment or distribution, the holders of the Senior
Indebtedness and other Indebtedness of the Company, the
amount thereof or payable thereon, the amount or amounts
paid or distributed thereon and all other facts pertinent
thereto or to this Article 10. In the event that the
Trustee determines, in good faith, that evidence is required
with respect to the right of any Person as a holder of
Senior Indebtedness to participate in any payment or
distribution pursuant to this Article 10, the Trustee may
request such Person to furnish evidence to the reasonable
satisfaction of the Trustee as to the amount of Senior
Indebtedness held by such Person, the extent to which such
Person is entitled to participate in such payment or
distribution and other facts pertinent to the rights of such
Person under this Article 10, and, if such evidence is not
furnished, the Trustee may defer any payment to such Person
pending judicial determination as to the right of such
Person to receive such payment. The provisions of Sections
7.01 and 7.02 shall be applicable to all actions or
omissions of actions by the Trustee pursuant to this Article
10.
SECTION 10.14. Trustee To Effectuate
Subordination. Each Securityholder by accepting a Security
authorizes and directs the Trustee on his behalf to take
such action as may be necessary or appropriate to
acknowledge or effectuate the subordination between the
Securityholders and the holders of Senior Indebtedness as
provided in this Article 10 and appoints the Trustee as
attorney-in-fact for any and all such purposes.
SECTION 10.15. Trustee Not Fiduciary for
Holders of Senior Indebtedness. The Trustee shall not be
deemed to owe any fiduciary duty to the holders of Senior
Indebtedness and shall not be liable to any such holders if
it shall mistakenly pay over or distribute to
Securityholders or the Company or any other Person, money or
assets to which any holders of Senior Indebtedness shall be
entitled by virtue of this Article 10 or otherwise.
SECTION 10.16. Reliance by Holders of Senior
Indebtedness on Subordination Provisions. Each
Securityholder by accepting a Security acknowledges and
agrees that the foregoing subordination provisions are, and
are intended to be, an inducement and a consideration to
each holder of any Senior Indebtedness, whether such Senior
Indebtedness was created or acquired before or after the
issuance of the Securities, to acquire and continue to hold,
or to continue to hold, such Senior Indebtedness and such
holder of Senior Indebtedness shall be deemed conclusively
to have relied on such subordination provisions in acquiring
and continuing to hold, or in continuing to hold, such
Senior Indebtedness.
ARTICLE 11
MISCELLANEOUS
SECTION 11.01. Trust Indenture Act Controls.
If any provision of this Indenture limits, qualifies or
conflicts with another provision which is required to be
included in this Indenture by the TIA, the required
provision shall control.
SECTION 11.02. Notices. Any notice or
communication to the Company or the Trustee required or
permitted hereunder shall be in writing and shall be
sufficiently given if made by hand delivery, by facsimile
transmission, by overnight express service or by registered
or certified mail, postage prepaid, return receipt
requested, addressed as follows:
if to the Company:
Hexcel Corporation
5794 West Las Positas Boulevard
Pleasanton, CA 94588
Tel: 510-847-9500
Fax: 510-734-8611
Attention: Rodney P. Jenks, Esq.
if to the Trustee:
First Trust of California
One California Street, 4th Floor
San Francisco, CA 94111
Tel: 415-273-4512
Fax: 415-273-4590
Attention: Ms. Kerri S. Jones
The Company or the Trustee by notice to the
other may designate additional or different addresses for
subsequent notices or communications.
Any notice or communication mailed to a
Securityholder shall be mailed to the Securityholder at the
Securityholder's address as it appears on the registration
books of the Registrar and shall be sufficiently given if so
mailed within the time prescribed.
Failure to mail a notice or communication to a
Securityholder or any defect in it shall not affect its
sufficiency with respect to other Securityholders. If a
notice or communication is mailed in the manner provided
above, it is duly given, whether or not the addressee
receives it.
SECTION 11.03. Communication by Holders with
Other Holders. Securityholders may communicate pursuant to
TIA SECTION 312(b) with other Securityholders with respect to
their rights under this Indenture or the Securities. The
Company, the Trustee, the Registrar and anyone else shall
have the protection of TIA SECTION 312(c).
SECTION 11.04. Certificate and Opinion as to
Conditions Precedent. Upon any request or application by
the Company to the Trustee to take or refrain from taking
any action under this Indenture, the Company shall furnish
to the Trustee:
(1) an Officers' Certificate in form and
substance reasonably satisfactory to the Trustee
stating that, in the opinion of the signers, all
conditions precedent, if any, provided for in this
Indenture relating to the proposed action have
been complied with; and
(2) an Opinion of Counsel in form and substance
reasonably satisfactory to the Trustee stating
that, in the opinion of such counsel, all such
conditions precedent have been complied with.
SECTION 11.05. Statements Required in
Certificate or Opinion. Each certificate or opinion with
respect to compliance with a covenant or condition provided
for in this Indenture shall include:
(1) a statement that the individual making such
certificate or opinion has read such covenant or
condition;
(2) a brief statement as to the nature and
scope of the examination or investigation upon
which the statements or opinions contained in such
certificate or opinion are based;
(3) a statement that, in the opinion of such
individual, he has made such examination or
investigation as is necessary to enable him to
express an informed opinion as to whether or not
such covenant or condition has been complied with;
and
(4) a statement as to whether or not, in the
opinion of such individual, such covenant or
condition has been complied with, provided that,
with respect to matters of fact, an Opinion of
Counsel may rely on an Officers' Certificate or
certificates of public officials.
SECTION 11.06. Rules by Trustee, Paying Agent
and Registrar. The Trustee may make reasonable rules for
action by or a meeting of Securityholders. The Registrar
and the Paying Agent may make reasonable rules for their
functions.
SECTION 11.07. Legal Holidays. A "Legal
Holiday" is a Saturday, a Sunday or a day on which banking
institutions are not required to be open in the State of New
York. If a payment date is a Legal Holiday, payment shall
be made on the next succeeding day that is not a Legal
Holiday, and no interest shall accrue for the intervening
period. If a regular record date is a Legal Holiday, the
record date shall not be affected.
SECTION 11.08. GOVERNING LAW. THIS INDENTURE
AND THE SECURITIES SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK BUT
WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS
OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF
ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
SECTION 11.09. No Recourse Against Others.
Any director, officer, employee, stockholder or Affiliate,
as such, of the Company shall not have any liability for any
obligations of the Company under the Securities or this
Indenture or for any claim based on, in respect of or by
reason of such obligations or their creation. By accepting
a Security, each Securityholder waives and releases all such
liability. Such waiver and release are part of the
consideration for the issue of the Securities.
SECTION 11.10. Successors. All agreements of
the Company in this Indenture and the Securities shall bind
its successors. All agreements of the Trustee in this
Indenture shall bind its successors.
SECTION 11.11. Multiple Originals. The
parties may sign any number of copies of this Indenture.
Each signed copy shall be an original, but all of them
together represent the same agreement. One signed copy is
enough to prove this Indenture.
SECTION 11.12. Table of Contents; Headings.
The table of contents, cross-reference sheet and headings of
the Articles and Sections of this Indenture have been
inserted for convenience of reference only, are not intended
to be considered a part hereof and shall not modify or
restrict any of the terms or provisions hereof.
SECTION 11.13. Severability. In case any
provision in this Indenture or in the Securities shall be
invalid, illegal or unenforceable, the validity, legality
and enforceability of the remaining provisions shall not in
any way be affected or impaired thereby.
IN WITNESS WHEREOF, the parties have caused
this Indenture to be duly executed as of the date first
written above.
HEXCEL CORPORATION,
by /s/ WILLIAM P. MEEHAN
Name: William P. Meehan
Title: Vice President, Chief Financial Officer and Treasurer
FIRST TRUST OF CALIFORNIA, NATIONAL ASSOCIATION,
by /s/ KERRI JONES
Name: Kerri Jones
Title: Assistant Vice President
EXHIBIT A
[FORM OF FACE OF SECURITY]
Increasing Rate Senior Subordinated Notes Due 2003
No. Series [ ] $
Hexcel Corporation, a Delaware corporation,
promises to pay to , or registered
assigns, the principal sum of Dollars
on .
Interest Payment Dates: March 1 and September 1.
Record Dates: February 15 and August 15.
Additional provisions of this Security are set
forth on the other side of this Security, which will, for
all purposes, have the same effect as it set forth at this
place.
Dated:
HEXCEL CORPORATION,
by_______________________
President
_______________________
Secretary
TRUSTEE'S CERTIFICATE OF
AUTHENTICATION
FIRST TRUST OF CALIFORNIA,
NATIONAL ASSOCIATION
,
as Trustee, certifies
[Seal] that this is one of
the Securities referred
to in the Indenture.
by
_____________________________
Authorized Signatory
[FORM OF REVERSE SIDE OF SECURITY]
Increasing Rate Senior Subordinated Notes Due 2003
Series [ ]
1. Interest
Hexcel Corporation, a Delaware corporation (such
corporation, and its successors and assigns under the
Indenture hereinafter referred to, being herein called the
"Company"), promises to pay interest on the principal amount
of this Security at the rate of 7.5% per annum from
[ ], 199[ ]. On the first anniversary of the date
of the Closing (as defined in the Strategic Alliance
Agreement dated as of September 29, 1995, among Ciba-Geigy
Limited, Ciba-Geigy Corporation and the Company), the rate
of interest then borne by the Securities shall increase to
9.5%, and on each subsequent anniversary of the Closing the
rate of interest then borne by the Securities shall increase
by an additional 0.5%. The Company will pay interest
semiannually on March 1 and September 1 of each year,
beginning [March 1] [September 1], 199[ ]; provided, that
interest accrued following the Closing Date shall be paid on
the first interest payment date following the date that
Securities are first issued pursuant to the Indenture.
Interest on the Securities will accrue from the most recent
date to which interest has been paid or, if no interest has
been paid, from [ ]. Interest will be
computed on the basis of a 360-day year of twelve 30-day
months. The Company shall pay interest on overdue principal
at the rate borne by the Securities, and it shall pay
interest on overdue installments of interest (including, if
applicable, installments in respect of Securities not yet
issued) at the same rate to the extent lawful. Except in
respect of the date from which interest on the Securities
accrues, the Securities of all series shall be deemed to
constitute one series for all purposes under the Indenture.
2. Method of Payment
The Company will pay interest on the Securities
(except defaulted interest) to the Persons who are
registered holders of Securities at the close of business on
the record date immediately preceding the interest payment
date even if Securities are canceled after the record date
and on or before the interest payment date. Holders must
surrender Securities to a Paying Agent to collect principal
payments. The Company will pay principal and interest in
money of the United States of America that at the time of
payment is legal tender for payment of public and private
debts. However, the Company may pay principal and interest
by check payable in such money. The Company may mail an
interest check to a Holder at such Holder's registered
address.
3. Paying Agent and Registrar
Initially, a
corporation ("Trustee"), will act as Paying Agent and
Registrar. The Company may appoint and change any Paying
Agent, Registrar or co-registrar without notice to the
Holders. The Company or any of its domestically
incorporated Wholly Owned Subsidiaries may act as Paying
Agent, Registrar or co-registrar.
4. Indenture
The Company issued the Securities under an
Indenture dated as of , 1996 ("Indenture"),
between the Company and the Trustee. The terms of the
Securities include those stated in the Indenture and those
made part of the Indenture by reference to the Trust
Indenture Act of 1939 (15 U.S.C. SECTIONSECTION 77aaa-77bbbb) as in
effect on the date of the Indenture (the "Act"). Terms
defined in the Indenture and not defined herein have the
meanings ascribed thereto in the Indenture. The Securities
are subject to all such terms, and Securityholders are
referred to the Indenture and the Act for a statement of
those terms.
The Securities are general unsecured obligations
of the Company. The Indenture imposes certain limitations
on the Company and the Subsidiaries, including the
Incurrence of Indebtedness, the payment of dividends on and
retirements of the Capital Stock of the Company and the
Subsidiaries and Subordinated Obligations, the making of
Investments, the sale of assets and transactions with
Affiliates. In addition, the Indenture limits the ability
of the Company and its Subsidiaries to restrict
distributions and dividends from Subsidiaries.
5. Optional Redemption
The Company may redeem the Securities in whole at
any time or in part from time to time at a redemption price
equal to 100% of the principal amount of the Securities to
be redeemed, plus accrued interest to the redemption date
(subject to the right of Holders of record on the relevant
record date to receive interest due on the related interest
payment date).
The Company is not required to make mandatory
redemption or sinking fund payments.
6. Notice of Redemption
Notice of redemption will be mailed at least 30
days but not more than 60 days before the redemption date to
each Holder of Securities to be redeemed at his registered
address. Securities in denominations larger than $1,000 may
be redeemed in part but only in whole multiples of $1,000.
If money sufficient to pay the redemption price of and
accrued interest on all Securities (or portions thereof) to
be redeemed on the redemption date is deposited with the
Paying Agent on or before the redemption date and certain
other conditions are satisfied, on and after such date
interest ceases to accrue on such Securities (or such
portions thereof) called for redemption, and the only right
of the holders of such Securities (or such portions thereof)
will be to receive payment of the redemption price and any
accrued and unpaid interest to the date fixed for
redemption.
7. Put Provisions
Upon a Change of Control, any Holder of Securities
(other than, in certain circumstances, Ciba-Geigy Limited
and its affiliates) will have the right, subject to certain
conditions, to cause the Company to repurchase all or any
part of the Securities of such Holder at a repurchase price
equal to 101% of the principal amount of the Securities to
be repurchased plus accrued interest to the date of
repurchase (subject to the right of holders of record on the
relevant record date to receive interest due on the related
interest payment date) as provided in, and subject to the
terms of, the Indenture.
8. Subordination
The Securities are subordinated to Senior
Indebtedness, as defined in the Indenture. To the extent
provided in the Indenture, Senior Indebtedness must be paid
in full in cash, Cash Equivalents or on terms otherwise
acceptable to the holders of Senior Indebtedness before the
Securities may be paid. Each Securityholder by accepting a
Security agrees to the subordination provisions contained in
the Indenture and authorizes the Trustee to give it effect
and appoints the Trustee as attorney-in-fact for such
purpose. The Indenture also provides that, under certain
circumstances, the Company will be prohibited from making
any payments in respect of the Securities if the Company is
in default on any Senior Indebtedness.
9. Denominations; Transfer; Exchange
The Securities are in registered form, without
coupons, in denominations of $1,000 and whole multiples of
$1,000. A Holder may transfer or exchange Securities in
accordance with the Indenture. The Registrar may require a
Holder, among other things, to furnish appropriate
endorsements or transfer documents and to pay any taxes and
fees required by law or permitted by the Indenture. The
Registrar need not register the transfer of or exchange any
Securities selected for redemption (except, in the case of a
Security to be redeemed in part, the portion of the Security
not to be redeemed) or any Securities for a period of
15 days before a selection of Securities to be redeemed or
15 days before an interest payment date.
10. Persons Deemed Owners
The registered Holder of this Security may be
treated as the owner of it for all purposes.
11. Unclaimed Money
If money for the payment of principal or interest
remains unclaimed for two years, the Trustee or Paying Agent
shall pay the money back to the Company at its request
unless an abandoned property law designates another Person.
After any such payment, Holders entitled to the money must
look only to the Company and not to the Trustee for payment.
12. Discharge and Defeasance
Subject to certain conditions, the Company at any
time may terminate some or all of its obligations under the
Securities and the Indenture if the Company deposits with
the Trustee money or U.S. Government Obligations for the
payment of principal and interest on the Securities to
redemption or maturity, as the case may be.
13. Amendment, Waiver
Subject to certain exceptions set forth in the
Indenture, (i) the Indenture or the Securities may be
amended with the written consent of the Holders of at least
a majority in principal amount outstanding of the Securities
and (ii) any default or noncompliance with any provision may
be waived with the written consent of the Holders of a
majority in principal amount outstanding of the Securities.
Subject to certain exceptions set forth in the Indenture,
without the consent of any Securityholder, the Company and
the Trustee may amend the Indenture or the Securities to
cure any ambiguity, omission, defect or inconsistency, or to
comply with Article 5 of the Indenture, or to provide for
uncertificated Securities in addition to or in place of
certificated Securities, or to add guarantees with respect
to the Securities or to secure the Securities, or to add
additional covenants or surrender rights and powers
conferred on the Company, or to comply with the TIA or to
make certain changes in the subordination provisions, or to
make any change that does not adversely affect the rights of
any Securityholder.
14. Defaults and Remedies
Under the Indenture, Events of Default include
(i) default for 30 days in payment of interest on the
Securities; (ii) default in payment of principal on the
Securities at maturity, upon redemption pursuant to
paragraph 5 of the Securities, upon acceleration or
otherwise, or failure by the Company to redeem or purchase
Securities when required; (iii) failure by the Company to
comply with other agreements in the Indenture or the
Securities, in certain cases subject to notice and lapse of
time; (iv) certain accelerations (including failure to pay
within any grace period after final maturity) of other
Indebtedness of the Company if the amount accelerated (or so
unpaid) exceeds $10,000,000 and continues for 10 days after
the required notice to the Company; (v) certain events of
bankruptcy or insolvency with respect to the Company or any
Significant Subsidiary; and (vi) certain judgments or
decrees for the payment of money with respect to the Company
or any Significant Subsidiary in excess of $10,000,000. If
an Event of Default occurs and is continuing, the Trustee or
the Holders of at least 25% in principal amount of the
Securities or, in certain circumstances, Ciba-Geigy Limited
may declare all the Securities to be due and payable
immediately. Certain events of bankruptcy or insolvency are
Events of Default which will result in the Securities being
due and payable immediately upon the occurrence of such
Events of Default.
Securityholders may not enforce the Indenture or
the Securities except as provided in the Indenture. The
Trustee may refuse to enforce the Indenture or the
Securities unless it receives reasonable indemnity or
security. Subject to certain limitations, Holders of a
majority in principal amount of the Securities may direct
the Trustee in its exercise of any trust or power. The
Trustee may withhold from Securityholders notice of any
continuing Default (except a Default in payment of principal
or interest) if it determines that withholding notice is in
the interest of the Holders.
15. Trustee Dealings with the Company
Subject to certain limitations imposed by the Act,
the Trustee under the Indenture, in its individual or any
other capacity, may become the owner or pledgee of
Securities and may otherwise deal with and collect
obligations owed to it by the Company or its Affiliates and
may otherwise deal with the Company or its Affiliates with
the same rights it would have if it were not Trustee.
16. No Recourse Against Others
Any director, officer, employee, stockholder or
Affiliate, as such, of the Company or the Trustee shall not
have any liability for any obligations of the Company under
the Securities or the Indenture or for any claim based on,
in respect of or by reason of such obligations or their
creation. By accepting a Security, each Securityholder
waives and releases all such liability. Such waiver and
release are part of the consideration for the issue of the
Securities.
17. Authentication
This Security shall not be valid until an
authorized signatory of the Trustee (or an authenticating
agent) manually signs the certificate of authentication on
the other side of this Security.
18. Abbreviations
Customary abbreviations may be used in the name of
a Securityholder or an assignee, such as TEN COM (=tenants
in common), TEN ENT (=tenants by the entireties), JT TEN
(=joint tenants with rights of survivorship and not as
tenants in common), CUST (=custodian), and U/G/M/A (=Uniform
Gift to Minors Act).
19. CUSIP NUMBERS
Pursuant to a recommendation promulgated by the
Committee on Uniform Security Identification Procedures, the
Company has caused CUSIP numbers to be printed on the
Securities and has directed the Trustee to use CUSIP numbers
in notices of redemption as a convenience to
Securityholders. No representation is made as to the
accuracy of such numbers either as printed on the Securities
or as contained in any notice of redemption and reliance may
be placed only on the other identification numbers placed
thereon.
THE COMPANY WILL FURNISH TO ANY SECURITYHOLDER
UPON WRITTEN REQUEST TO THE SECURITYHOLDER A COPY OF THE
INDENTURE WHICH HAS IN IT THE TEXT OF THIS SECURITY IN
LARGER TYPE. REQUESTS MAY BE MADE TO:
ATTENTION OF
_________________________________________________________
ASSIGNMENT FORM
To assign this Security, fill in the form below:
I or we assign and transfer this Security to
_________________________
_________________________
_________________________
(Print or type assignee's name, address and zip code)
(Insert assignee's soc. sec. or tax I.D. No.) ________
and irrevocably appoint agent to
transfer this Security on the books of the Company. The
agent may substitute another to act for him.
Date: ________________ Your Signature: _____________________
Sign exactly as your name appears on the other side of this
Security.
SIGNATURE GUARANTEE:
(SIGNATURE MUST BE GUARANTEED BY AN ELIGIBLE GUARANTOR
INSTITUTION)
OPTION OF HOLDER TO ELECT PURCHASE
IF YOU WANT TO ELECT TO HAVE THIS SECURITY
PURCHASED BY THE COMPANY PURSUANT TO SECTION 4.06 OR 4.08 OF
THE INDENTURE, CHECK THE BOX:
( )
IF YOU WANT TO ELECT TO HAVE ONLY PART OF
THIS SECURITY PURCHASED BY THE COMPANY PURSUANT TO
SECTION 4.06 OR 4.08 OF THE INDENTURE, STATE THE AMOUNT YOU
WANT TO BE PURCHASED: $__________
$
DATE: __________________ YOUR SIGNATURE:
(SIGN EXACTLY AS YOUR NAME APPEARS ON THE OTHER SIDE OF THE
SECURITY)
SIGNATURE GUARANTEE:
(SIGNATURE MUST BE GUARANTEED BY AN ELIGIBLE GUARANTOR
INSTITUTION)
EXHIBIT B
RETENTION AGREEMENT, dated as of February 29,
1996, between Hexcel Corporation, a Delaware corporation
("Hexcel") and Ciba-Geigy Limited, a Swiss corporation
("CGL").
WHEREAS, CGL (directly or indirectly through one
or more wholly-owned subsidiaries) owns approximately 49.9
percent of the issued and outstanding common stock of
Hexcel.
WHEREAS, pursuant to the Strategic Alliance
Agreement, dated as of September 29, 1995, and as amended as
of December 12, 1995 and as further amended as of February
28, 1996, among CGL, Ciba-Geigy Corporation and Hexcel,
Hexcel has agreed to deliver to Ciba (as defined below) its
Increasing Rate Senior Subordinated Notes due 2003 (the
"Senior Subordinated Notes"), which are to be issued
pursuant to an Indenture, dated as of February 29, 1996 (the
"Indenture"), between Hexcel and First Trust of California,
National Association, as trustee (the "Trustee") thereunder.
WHEREAS, Hexcel and certain of its subsidiaries
have entered into a Credit Agreement dated as of February
29, 1996 (the "Credit Agreement"), with the financial
institutions named therein as lenders and/or as issuing
banks, Citibank, N.A., as U.S. administrative agent,
Citibank International plc, as European administrative
agent, and Credit Suisse, as syndication agent.
WHEREAS, under the terms of the Credit Agreement,
an Event of Default (as defined in the Credit Agreement)
shall occur (i) if, under certain circumstances, CGL shall
cease to hold directly or indirectly (through one or more
wholly-owned subsidiaries (each, a "Subsidiary", and CGL,
together with a Subsidiary that becomes an owner of any
Senior Subordinated Notes, "Ciba")) 100% in principal amount
of the Senior Subordinated Notes or (ii) CGL shall cease to
beneficially own, directly or indirectly, at least 40% of
the Voting Stock (as defined in the Credit Agreement) of the
Company.
NOW, THEREFORE, in consideration of the premises
and for the issuance of the Senior Subordinated Notes, CGL
agrees with Hexcel, for the benefit of Hexcel, as follows:
1. (A) Prior to the first to occur of (i) March
1, 1999, (ii) the payment in full of all Obligations (as
defined in the Credit Agreement) and the termination of all
Commitments (as defined in the Credit Agreement) and (iii)
the extension of the Revolving Credit Termination Date (as
defined in the Credit Agreement) without the consent of CGL,
or (B) at any time when any Event of Default in Section
11.01 (a) of the Credit Agreement shall have occurred and be
continuing, CGL shall hold directly or indirectly (through
one or more Subsidiaries) one hundred percent (100%) of the
outstanding principal amount of the Senior Subordinated
Notes; provided that Ciba may transfer to any Subsidiary of
CGL all or any part of the Senior Subordinated Notes if such
Subsidiary complies with the provisions of the next
paragraph; and provided, further, that if a Subsidiary of
CGL becomes a holder of all or any portion of the Senior
Subordinated Notes as permitted by this Agreement, CGL may
effect a Broad Distribution (as defined in the Governance
Agreement (as defined in the Indenture)) of up to 20% of the
capital stock of such Subsidiary, but only if (1) such
distribution has a bona fide business purpose (other than
the sale or distribution of Senior Subordinated Notes) and
(2) the Senior Subordinated Notes "beneficially owned" (as
defined in Rule 13d-3 under the Securities Exchange Act of
1934, as amended (the "Exchange Act")) by such Subsidiary do
not constitute a material portion of the total assets of
such Subsidiary.
CGL shall cause any Subsidiary of CGL that
acquires any portion of the Senior Subordinated Notes, from
any person whatsoever, whether upon original issuance or at
any time thereafter while CGL is required to hold, directly
or indirectly, 100% of the outstanding principal amount of
the Senior Subordinated Notes pursuant to the preceding
paragraph (each such transferee, a "Transferee"), to agree,
prior to, or concurrently with, acquiring such Senior
Subordinated Notes, to be bound by this Agreement by
executing an Agreement To Be Bound, substantially in the
form of Annex 1 to this Agreement, and delivering it to
Hexcel. Upon the execution and delivery of such Agreement
To Be Bound, all references in this Agreement to "Ciba"
shall include such Transferee. CGL shall cause each
Transferee to comply with terms of this Agreement.
2. CGL shall "beneficially own" (as defined in
Rules 13d-3 and 13d-5 under the Exchange Act), directly or
indirectly, at least forty percent (40%) of the Voting Stock
of the Company so long as the failure of CGL to do so would
result in an Event of Default under the Credit Agreement.
3. Until CGL is no longer required to hold,
directly or indirectly, 100% of the outstanding principal
amount of the Senior Subordinated Notes pursuant to the
first paragraph of Section 1 of this Agreement, except as
permitted by such Section 1, Ciba shall not sell, assign,
transfer or otherwise dispose of all or any portion of the
Senior Subordinated Notes, and any such purported sale,
assignment, transfer or other disposition shall be void and
of no effect, and Ciba shall not negotiate or grant any
lien, interest, pledge, charge, security interest or other
encumbrance of, or any participation in, all or any part of
the Senior Subordinated Notes or other liabilities owed
thereunder.
4. Subject to Section 5, the certificate or
certificates representing the Senior Subordinated Notes
shall bear the following legend, which shall appear on the
face of such certificates:
PURSUANT TO A RETENTION AGREEMENT, DATED AS OF
__________, 199[] (THE "RETENTION AGREEMENT"), BETWEEN
HEXCEL CORPORATION (THE "COMPANY") AND CIBA-GEIGY
LIMITED ("CGL"), A COPY OF WHICH IS ON FILE IN THE
OFFICES OF THE COMPANY, CGL AND ANY WHOLLY-OWNED
SUBSIDIARY OF CGL THAT HOLDS ANY OF THE SECURITIES
REPRESENTED BY THIS CERTIFICATE HAVE AGREED THAT CGL OR
SUCH SUBSIDIARY WILL HOLD THIS SECURITY UNTIL
RESTRICTION PROVIDED IN THE RETENTION AGREEMENT CEASE
TO BE EFFECTIVE, AND THEY HAVE AGREED THAT ANY
ATTEMPTED SALE, TRANSFER ASSIGNMENT OR OTHER
DISPOSITION OF THIS SECURITY TO A PERSON OTHER THAN CGL
OR A WHOLLY-OWNED SUBSIDIARY OF CGL PRIOR TO SUCH TIME
WILL BE NULL AND VOID AB INITIO.
5. As soon as practicable after the time that CGL
is no longer required to hold, directly or indirectly, 100%
of the outstanding principal amount of the Senior
Subordinated Notes pursuant to the first paragraph of
Section 1 of this Agreement, Hexcel (i) shall deliver
written notice to CGL of such event in the manner provided
for notice in the Credit Agreement and (ii) shall instruct
the Trustee to issue or cause to be issued to Ciba, or the
person or persons designated by Ciba, a replacement
certificate or replacement certificates representing the
Senior Subordinated Notes then held by them, without the
legend set forth in Section 3 of this Agreement, in exchange
for the certificate or certificates then held by such
persons. Such issuance shall be accomplished as provided
in, and pursuant to the terms of, the Indenture.
6. Ciba acknowledges that any breach of this
Agreement would cause irreparable injury to Hexcel that
could not reasonably or adequately be compensated in damages
in an action at law. Ciba agrees therefore that Hexcel
shall be entitled, in addition to any other of its rights or
remedies, to temporary, preliminary and permanent
injunction, without the necessity of proving the inadequacy
of monetary damages or in posting any bond or security,
enjoining or restraining Ciba from any such violation or
threatened violations, and other equitable relief to prevent
the violation of any provision of this Agreement by Ciba.
Neither this provision nor the exercise of any of its rights
under this Section 5 shall constitute a waiver by Hexcel of
any other rights that it may have to damages or otherwise.
7. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
YORK BUT WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF
CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE
LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
IN WITNESS WHEREOF, the parties hereto have caused
this Agreement to be duly executed as of the date first
above written.
CIBA-GEIGY LIMITED
By: /s/ JOHN M.D. CHEESMOND
Name: John M.D. Cheesmond
Title: Head of Regional
Finance and Control
By: /s/ PETER RUDOLF
Name: Peter Rudolf
Title: Senior Division
Counsel
HEXCEL CORPORATION
By: /s/ WILLIAM P. MEEHAN
Name: William P. Meehan
Title: Vice President,
Chief Financial
Officer and
Treasurer
ANNEX 1
AGREEMENT TO BE BOUND
[Date]
The undersigned, a wholly-owned subsidiary of Ciba-
Geigy Limited ("CGL"), agrees to be bound by all the terms
and provisions of the Retention Agreement, dated _____,
1996, between Hexcel Corporation and CGL, that are
applicable to Ciba (as defined in the Retention Agreement),
as though the undersigned were a named party to such
Agreement.
[Name of Subsidiary]
By: ___________________
Name:
Title:
EXHIBIT NO. 99.1
CREDIT AGREEMENT
Dated as of February 29, 1996
for
$165,000,000 Senior Secured
Revolving Credit Facility
and
$10,000,000 Senior Secured
European Overdraft Facility
among
HEXCEL CORPORATION,
HEXCEL S.A. (BELGIUM),
HEXCEL S.A. (LYON),
BROCHIER S.A.,
HEXCEL (U.K.) LIMITED and
COMPOSITE MATERIALS LIMITED UNITED KINGDOM,
AS BORROWERS,
THE INSTITUTIONS FROM TIME TO TIME
PARTY HERETO AS LENDERS,
THE INSTITUTIONS FROM TIME TO TIME
PARTY HERETO AS ISSUING BANKS,
CITIBANK, N.A., NEW YORK BRANCH,
AS U.S. ADMINISTRATIVE AGENT,
CITIBANK INTERNATIONAL PLC,
AS EUROPEAN ADMINISTRATIVE AGENT,
and
CREDIT SUISSE,
AS SYNDICATION AGENT
TABLE OF CONTENTS
ARTICLE I
DEFINITIONS . . . . . . . . . 1
1.01. Certain Defined Terms . . . . . . . . . . 1
1.02. Computation of Time Periods . . . . . . . 37
1.03. Accounting Terms . . . . . . . . . . . . 37
1.04. Other Definitional Provisions . . . . . . 37
1.05. Other Terms . . . . . . . . . . . . . . . 37
ARTICLE II
AMOUNTS AND TERMS OF LOANS . . . . . 37
2.01. Revolving Credit Facility . . . . . . . . 38
2.02. Swing Loans . . . . . . . . . . . . . . . 42
2.03. European Overdraft Facility. . . . . . 44
2.04. Letters of Credit . . . . . . . . . . . . 45
2.05. Promise to Repay; Evidence of Indebted
ness . . . . . . . . . . . . . . . . . 54
2.06. Authorized Officers and Agents . . . . . 54
ARTICLE III
PAYMENTS AND PREPAYMENTS . . . . . . 55
3.01. Prepayments; Reductions in Revolving
Credit Commitments . . . . . . . . . 55
3.02. Payments . . . . . . . . . . . . . . . . 57
3.03. Taxes . . . . . . . . . . . . . . . . . . 63
3.04. Increased Capital . . . . . . . . . . . . 68
ARTICLE IV
INTEREST AND FEES . . . . . . . . 69
4.01. Interest on the Loans and Other
Obligations . . . . . . . . . . . . . 69
4.02. Special Provisions Governing
Eurocurrency Rate Loans . . . . . . . 72
4.03. Fees . . . . . . . . . . . . . . . . . . 76
ARTICLE V
CONDITIONS TO LOANS AND LETTERS OF CREDIT . . 78
5.01. Conditions Precedent to the Initial
Loans and Letters of Credit . . . . . 78
5.02. Conditions Precedent to All Subsequent
Revolving Loans, Swing Loans,
European Overdraft Loans and
Letters of Credit . . . . . . . . . . 81
ARTICLE VI
REPRESENTATIONS AND WARRANTIES . . . . 85
6.01. Representations and Warranties
of the Borrowers . . . . . . . . . . . 85
ARTICLE VII
REPORTING COVENANTS . . . . . . . 95
7.01. Financial Statements . . . . . . . . . . 95
7.02. Events of Default . . . . . . . . . . . . 97
7.03. Lawsuits . . . . . . . . . . . . . . . . 98
7.04. ERISA Notices . . . . . . . . . . . . . . 98
7.05. Environmental Notices . . . . . . . . . . 100
7.06. Labor Matters . . . . . . . . . . . . . . 101
7.07. Public Filings and Reports . . . . . . . 102
7.08. Government Contracts . . . . . . . . . . 102
7.09. Other Information . . . . . . . . . . . . 102
ARTICLE VIII
AFFIRMATIVE COVENANTS . . . . . . . 102
8.01. Corporate Existence, Etc. . . . . . . . . 102
8.02. Corporate Powers; Conduct of
Business, Etc. . . . . . . . . . . . . 103
8.03. Compliance with Laws, Etc. . . . . . . . 103
8.04. Payment of Taxes and Claims; Tax
Consolidation . . . . . . . . . . . . 103
8.05. Insurance . . . . . . . . . . . . . . . . 103
8.06. Inspection of Property; Books and
Records; Discussions . . . . . . . . . 104
8.07. ERISA Compliance . . . . . . . . . . . . 104
8.08. Foreign Employee Benefit Plan
Compliance . . . . . . . . . . . . . . 104
8.09. Maintenance of Property . . . . . . . . . 104
8.10. Subsidiary Guarantors; Future
Liens on Capital Stock . . . . . . . . 105
8.11. CML Guaranty . . . . . . . . . . . . . . 106
8.12. Lodi Facility Guaranty . . . . . . . . . 106
8.13. Connecticut Opinion . . . . . . . . . . . 106
8.14 Hexcel Technologies Pledge . . . . . . . 106
8.15. Replacement of Existing Standby
Letters of Credit . . . . . . . . . . 106
ARTICLE IX
NEGATIVE COVENANTS . . . . . . . 106
9.01. Indebtedness . . . . . . . . . . . . . . 107
9.02. Sales of Assets . . . . . . . . . . . . . 108
9.03. Liens . . . . . . . . . . . . . . . . . . 109
9.04. Investments . . . . . . . . . . . . . . . 110
9.05. Accommodation Obligations . . . . . . . . 112
9.06. Restricted Junior Payments . . . . . . . 113
9.07. Conduct of Business . . . . . . . . . . . 113
9.08. Transactions with Affiliates . . . . . . 113
9.09. Restriction on Fundamental Changes . . . 114
9.10. Sales and Leasebacks; Operating Leases . 114
9.11. Margin Regulations; Securities Laws . . . 115
9.12. ERISA and Certain Employment Matters . . 115
9.13. Issuance or Sale of Capital Stock . . . . 116
9.14. Constituent Documents . . . . . . . . . . 116
9.15. Fiscal Year . . . . . . . . . . . . . . . 116
9.16. Cancellation of Debt; Prepayment . . . . 116
9.17. Environmental Matters. . . . . . . . . . 117
9.18. Accounting Changes . . . . . . . . . . . 117
9.19. No New Restrictions on Subsidiary
Dividends . . . . . . . . . . . . . . 117
ARTICLE X
FINANCIAL COVENANTS . . . . . . . 118
10.01. Minimum Tangible Net Worth . . . . . . . 118
10.02. Minimum Fixed Charge Coverage Ratio . . 118
10.03. Maximum Leverage Ratio . . . . . . . . . 119
ARTICLE XI
EVENTS OF DEFAULT; RIGHTS AND REMEDIES . . 119
11.01. Events of Default . . . . . . . . . . . 119
11.02. Rights and Remedies . . . . . . . . . . 123
ARTICLE XII
THE ADMINISTRATIVE AGENT; SYNDICATION AGENT . 125
12.01. Appointment . . . . . . . . . . . . . . 125
12.02. Nature of Duties . . . . . . . . . . . . 126
12.03. Rights, Exculpation, Etc. . . . . . . . 126
12.04. Reliance . . . . . . . . . . . . . . . . 127
12.05. Indemnification . . . . . . . . . . . . 127
12.06. Citibank and Credit Suisse
Individually . . . . . . . . . . . . . 128
12.07. Successor Administrative Agent;
Resignation of Administrative
Agent and Syndication Agent . . . . . 128
12.08. Relations Among Lenders . . . . . . . . 129
12.09. Concerning the Collateral and
the Loan Documents . . . . . . . . . . 129
ARTICLE XIII
MISCELLANEOUS . . . . . . . . . 131
13.01. Assignments and Participations . . . . . 131
13.02. Expenses . . . . . . . . . . . . . . . . 135
13.03. Indemnity . . . . . . . . . . . . . . . 137
13.04. Change in Accounting Principles . . . . 138
13.05. Setoff . . . . . . . . . . . . . . . . . 138
13.06. Ratable Sharing . . . . . . . . . . . . 139
13.07. Amendments and Waivers . . . . . . . . . 140
13.08. Notices . . . . . . . . . . . . . . . . 141
13.09. Survival of Warranties and Agreements . 142
13.10. Failure or Indulgence Not Waiver;
Remedies Cumulative . . . . . . . . . 142
13.11. Marshalling; Payments Set Aside . . . . 142
13.12. Severability . . . . . . . . . . . . . . 143
13.13. Headings . . . . . . . . . . . . . . . . 143
13.14. Governing Law . . . . . . . . . . . . . 143
13.15. Limitation of Liability . . . . . . . . 143
13.16. Successors and Assigns . . . . . . . . . 143
13.17. Certain Consents and Waivers . . . . . . 144
13.18. Counterparts; Effectiveness;
Inconsistencies . . . . . . . . . . . 145
13.19. Limitation on Agreements . . . . . . . . 145
13.20. Confidentiality . . . . . . . . . . . . 145
13.21. Judgment Currency . . . . . . . . . . . 146
13.22. Entire Agreement . . . . . . . . . . . . 146
13.23. Termination . . . . . . . . . . . . . . 147
EXHIBITS
Exhibit A -- Form of Assignment and Acceptance
Exhibit B -- Form of Notice of Borrowing
Exhibit C -- Form of Notice of Conversion/Continuation
Exhibit D -- List of Closing Documents
Exhibit E -- Form of Officer's Certificate to Accompany
Reports
Exhibit F -- Form of Revolving Credit Note
Exhibit G -- Form of Swing Loan Note
Exhibit H -- Form of Company Guaranty
Exhibit I -- Form of Domestic Subsidiary Guaranty
Exhibit J -- Form of Company Pledge Agreement
Exhibit K -- Form of European Overdraft Note
Exhibit L -- Form of Borrower Addendum
Exhibit M -- Form of Connecticut Counsel Opinion
CREDIT AGREEMENT
This Credit Agreement dated as of February 29,
1996 (as amended, supplemented or otherwise modified from
time to time, this "Agreement") is entered into among
Hexcel Corporation, a Delaware corporation (with its
successors and permitted assigns, the "Company"), and its
wholly-owned subsidiaries, Hexcel (U.K.) Limited, a
corporation organized and existing under the laws of
England and Wales ("Hexcel U.K."), Composite Materials
Limited United Kingdom, a corporation organized and
existing under the laws of the United Kingdom ("CML"),
Hexcel S.A., a French societe anonyme ("Hexcel Lyon"),
Brochier S.A., a French societe anonyme ("Brochier"), and
Hexcel S.A., a company organized and existing under the
laws of Belgium ("Hexcel Belgium"), the institutions from
time to time party hereto as Lenders, whether by
execution of this Agreement or an Assignment and
Acceptance, the institutions from time to time party
hereto as Issuing Banks, whether by execution of this
Agreement or an Assignment and Acceptance, Citibank,
N.A., a national banking association acting through its
New York branch ("Citibank New York"), in its separate
capacity as administrative agent for the Lenders and
Issuing Banks (with its successors in such capacity, the
"U.S. Administrative Agent"), Citibank International plc
("Citibank International"), in its separate capacity as
European administrative agent for the Lenders and Issuing
Banks (with its successors in such capacity, the
"European Administrative Agent"), and Credit Suisse, in
its separate capacity as syndication agent for the
Lenders and Issuing Banks (with its successors in such
capacity, the "Syndication Agent").
ARTICLE I
DEFINITIONS
1.01. Certain Defined Terms. In addition to
the terms defined above, the following terms used herein
shall have the following meanings, applicable both to the
singular and the plural forms of the terms defined:
"Accommodation Obligation" means any
Contractual Obligation, contingent or otherwise, of one
Person with respect to any Indebtedness of another, if
the primary purpose or intent thereof by the Person
incurring such Contractual Obligation is to provide
assurance to the obligee of such Indebtedness of another
that such Indebtedness shall be paid or discharged, or
that any agreements relating thereto shall be complied
with, or that the holders thereof shall be protected (in
whole or in part) against loss in respect thereof
including, without limitation, direct and indirect
guarantees, endorsements (except for collection or
deposit in the ordinary course of business), notes co-
made or discounted, recourse agreements, take-or-pay
agreements, keep-well agreements, agreements to purchase
security therefor (other than such agreements to purchase
in the ordinary course of business) or to provide funds
for the payment or discharge thereof, agreements to
maintain solvency, assets, level of income, or other
financial condition, and agreements to make payment other
than for value received.
"Acquired Businesses" means, collectively, the
global composites business (including, without
limitation, structures and interiors, fabrics, laminates,
prepegs, adhesive films, honeycomb core, sandwich panels
and fabricated components) of Ciba-Geigy, all of the
outstanding common stock of Danutec Werkstoff (if
acquired) and certain assets held, directly or
indirectly, by Ciba-Geigy (and certain liabilities
related thereto) that relate exclusively or primarily to,
arise exclusively or primarily out of, or are used
exclusively or primarily in connection with, such
composite business and that are located in certain
jurisdictions outside the United States, in each case
acquired by the Company and certain of its Subsidiaries
pursuant to the Strategic Alliance Agreement.
"Acquisition" means the acquisition by the
Company and certain of its Subsidiaries of the Acquired
Businesses.
"Acquisition Loan" means, individually or
collectively as the context requires, (i) the Revolving
Loan in the amount of $12,000,000 to be made to Hexcel
U.K. on the Closing Date to fund the cash payment to
Ciba-Geigy in connection with the acquisition by Hexcel
U.K. of the shares of CML as part of the Acquisition,
(ii) the Revolving Loan in the amount of $13,000,000 to
be made to Hexcel Lyon on the Closing Date to fund the
cash payment to Ciba-Geigy in connection with the
acquisition by Hexcel Lyon of the shares of Brochier and
CDSR as part of the Acquisition and (iii) the Revolving
Loan in an amount not to exceed $3,000,000 to be used to
pay Transaction Costs for the Acquisition and the
Acquisition Loans.
"Administrative Agent" means, collectively, the
U.S. Administrative Agent and the European Administrative
Agent; provided, that, with respect to European Overdraft
Loans, all Eurocurrency Rate Loans (whether or not
denominated in an Optional Currency) and all other Loans
or Letters of Credit requested by a Foreign Borrower,
Administrative Agent shall mean the European
Administrative Agent, and with respect to Swing Loans and
other Base Rate Loans requested by the Company,
Administrative Agent shall mean the U.S. Administrative
Agent.
"Administrative Agent's U.S. Account" means the
U.S. Administrative Agent's account number 36852248
(funding account re: Hexcel Corporation) maintained at
the office of Citibank International New York, New York
10043, Attention: Carmela Caputo, or such other deposit
account as the U.S. Administrative Agent may from time to
time specify in writing to the Company and the Lenders.
"Administrative Agent's European Accounts"
means those certain accounts listed on Schedule 1.01.2
maintained at the office of Citibank International, or
such other deposit account(s) as the European
Administrative Agent may from time to time specify in
writing to the Company and the Lenders.
"Affiliate" of any specified Person means any
other Person (i) that directly or indirectly through one
or more intermediaries controls, or is controlled by, or
is under common control with, such specified Person, (ii)
that beneficially owns or holds 5% or more of any class
of the Voting Stock or other equity interest of such
specified Person or (iii) of which 5% or more of the
Voting Stock is beneficially owned or held by such
specified Person or a Subsidiary of such specified
Person; provided, that Hexcel Foundation shall not be
deemed an Affiliate of the Company for as long as it
maintains its status as a not-for-profit corporation for
purposes of California law. For the purposes of this
definition, "control" when used with respect to any
specified Person means the power to direct the management
and policies of such Person directly or indirectly,
whether through the ownership of Voting Stock, by
contract or otherwise; and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
"Aggregate Pro Rata Share" means, with respect
to any Lender, the percentage obtained by dividing (a)
the sum of such Lender's Revolving Credit Commitment at
such time plus such Lender's European Overdraft
Commitment, if any, at such time by (b) the aggregate
amount of all Revolving Credit Commitments and European
Overdraft Commitments at such time; provided, that if all
of the Revolving Credit Commitments and European
Overdraft Commitments are terminated pursuant to the
terms hereof, then "Aggregate Pro Rata Share" means the
percentage obtained by dividing (x) the sum of such
Lender's Revolving Credit Obligations plus such Lender's
European Overdraft Obligations by (y) the aggregate
amount of all Revolving Credit Obligations and European
Overdraft Obligations.
"Applicable Lending Office" means, with respect
to a particular Lender, its European Lending Office in
respect of Loans requested by Foreign Borrowers, and its
U.S. Lending Office in respect of Loans requested by the
Company.
"Assignment and Acceptance" means an Assignment
and Acceptance in substantially the form of Exhibit A
attached hereto and made a part hereof (with blanks
appropriately completed) delivered to the U.S.
Administrative Agent in connection with an assignment of
a Lender's interest hereunder in accordance with the
provisions of Section 13.01.
"Bankruptcy Code" means Title 11 of the United
States Code (11 U.S.C. SECTION 101 et seq.), as amended from
time to time, and any successor statute.
"Base Rate" means, (i) for any period
applicable to any Base Rate Loan denominated in Dollars,
a fluctuating interest rate per annum as shall be in
effect from time to time, which rate per annum shall at
all times be equal to the highest of:
(A) the rate of interest announced publicly by
Citibank in New York, New York from time to time, as
Citibank's base rate; and
(B) the sum (adjusted to the nearest one
sixteenth of one percent (0.0625%) or, if there is
no nearest one sixteenth of one percent (0.0625%),
to the next higher one sixteenth of one percent
(0.0625%)) of (I) one half of one percent (0.50%)
per annum plus (II) the rate per annum obtained by
dividing (x) the latest three-week moving average of
secondary market morning offering rates in the
United States for three-month certificates of
deposit of major United States money market banks,
such three-week moving average (adjusted to the
basis of a year of 360 days) being determined weekly
on each Monday (or, if such day is not a Business
Day, on the next succeeding Business Day) for the
three-week period ending on the previous Friday (or,
if such day is not a Business Day, on the next
preceding Business Day) by Citibank on the basis of
such rates reported by certificate of deposit
dealers to, and published by, the Federal Reserve
Bank of New York, or, if such publication shall be
suspended or terminated, on the basis of quotations
for such rates received by Citibank from three (3)
New York certificate of deposit dealers of
recognized standing selected by Citibank, by (y) a
percentage equal to 100% minus the average of the
daily percentages specified during such three-week
period by the Federal Reserve Board (or any
successor) for determining the maximum reserve
requirement (including, but not limited to, any
emergency, supplemental or other marginal reserve
requirement) for Citibank in respect of liabilities
which consist of or which include (among other
liabilities) three-month Dollar nonpersonal time
deposits in the United States plus (III) the average
during such three-week period of the annual
assessment rates estimated by Citibank for
determining the then current annual assessment
payable by Citibank to the Federal Deposit Insurance
Corporation (or any successor) for insuring Dollar
deposits of Citibank in the United States; and
(C) the sum of (A) one half of one
percent (0.50%) per annum plus (B) the Federal
Funds Rate in effect from time to time during
such period; and
(ii) for any period applicable to a European
Overdraft Loan, the Eurocurrency Rate applicable to the
requested Optional Currency for an Interest Period of
seven (7) days, as determined on Tuesday of each week.
"Base Rate Loans" means all Loans that bear
interest at a rate determined by reference to the Base
Rate and the Base Rate Margin as provided in Section
4.01(a).
"Base Rate Margin" means, as of any date, (i)
zero percent (0%) per annum for Base Rate Loans
denominated in Dollars and (ii) four-tenths of one
percent (0.40%) per annum for Base Rate Loans denominated
in any Optional Currency.
"Benefit Plan" means a defined benefit plan as
defined in Section 3(35) of ERISA (other than a
Multiemployer Plan) in respect of which the Company or
any of its ERISA Affiliates is, or within the immediately
preceding six (6) years was, an "employer" as defined in
Section 3(5) of ERISA.
"BNP" means Banque Nationale de Paris acting
through its San Francisco agency and its successors.
"Bond LC Reimbursement Agreement" means the
Second Restated and Amended Reimbursement Agreement dated
as of February __, 1996, by and between the Company and
BNP.
"Borrower Addendum" is defined in Section
5.03(a).
"Borrowers" means, collectively, the Company
and the Foreign Borrowers.
"Borrowing" means a borrowing consisting of
Loans of the same type made on the same day.
"Business Day" means a day, in the applicable
local time, that is not a Saturday or Sunday or a legal
holiday and on which banks are not required or permitted
by law or other governmental action to close (i) in New
York, New York or (ii) in the case of Eurocurrency Rate
Loans, (A) in London, England or (B) for Loans
denominated in Austrian shillings, in Austria, for Loans
denominated in Belgian francs, in Belgium, for Loans
denominated in French francs, in France, for Loans
denominated in Deutschmarks, in Germany, or for Loans
denominated in Netherlands guilders, in the Netherlands,
or (iii) in the case of Letter of Credit transactions for
a particular Issuing Bank, in the place where its office
for issuance or administration of the pertinent Letter of
Credit is located.
"Capital Expenditures" means, for any period,
the aggregate of all expenditures (whether payable in
cash or other Property or accrued as a liability (but
without duplication)) during such period that, in
conformity with GAAP, are required to be included in or
reflected by the Company's or any of its Subsidiaries'
fixed asset accounts as reflected in any of their
respective balance sheets; provided, that (i) Capital
Expenditures shall include (A) that portion of Capital
Leases which is incurred and capitalized during such
period on the balance sheet of the Company and its
Subsidiaries and (B) expenditures for Equipment that is
purchased simultaneously with the trade-in or disposal of
existing Equipment owned by the Company or any of its
Subsidiaries, to the extent the gross purchase price of
the purchased Equipment exceeds the actual value
attributed to such Equipment at the time of such trade-in
or disposal; and (ii) Capital Expenditures shall exclude
(A) expenditures made in connection with the replacement
or restoration of Property, to the extent reimbursed or
financed from insurance or condemnation proceeds and
(B) the Acquisition.
"Capital Lease", as applied to any Person,
means any lease of any property (whether real, personal
or mixed) by that Person as lessee that, in conformity
with GAAP, is accounted for as a capital lease on the
balance sheet of that Person.
"Capital Stock", with respect to any Person,
means any capital stock of such Person, regardless of
class or designation, and all warrants, options, purchase
rights, conversion or exchange rights, voting rights,
calls or claims of any character with respect thereto.
"Cash Collateral" means cash or Cash
Equivalents held by the Administrative Agent for the
benefit of the Issuing Banks or any of the Lenders as
security for the Reimbursement Obligations pursuant to
the terms of the Loan Documents.
"Cash Equivalents" means (i) marketable direct
obligations issued or unconditionally guaranteed by the
United States government and backed by the full faith and
credit of the United States government; (ii) domestic and
Eurocurrency certificates of deposit and time deposits,
bankers' acceptances and floating rate certificates of
deposit issued by any commercial bank organized under the
laws of the United States, any state thereof, the
District of Columbia, any foreign bank, or its branches
or agencies (fully protected against currency
fluctuations), which, at the time of acquisition, are
rated A-1 (or better) by Standard & Poor's Corporation
(or its successors) or P-1 (or better) by Moody's
Investors Service, Inc. (or its successors); (iii)
commercial paper of United States and foreign banks and
bank holding companies and their subsidiaries and United
States and foreign finance, commercial industrial or
utility companies which, at the time of acquisition, are
rated A-1 (or better) by Standard & Poor's Corporation
(or its successors) or P-1 (or better) by Moody's
Investors Service, Inc. (or its successors); (iv)
marketable direct obligations of any state of the United
States of America or any political subdivision of any
such state given on the date of such investment the
highest credit rating by Moody's Investor Service, Inc.
(or its successors) and Standard & Poor's Corporation (or
its successors); and (v) reverse purchase agreements
covering obligations of the type specified in clause (i);
provided, that the maturities of any such Cash
Equivalents referred to in clauses (i) through (v) shall
not exceed one hundred eighty (180) days.
"CDSR" means Confection et Diffusion de Stores
et Rideaux, a corporation organized and existing under
the laws of France.
"CERCLA" means the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, 42
U.S.C. SECTION 9601 et seq., as amended, any successor
statutes, and any regulations or legally enforceable
guidelines promulgated thereunder.
"CERCLIS" is defined in Section 6.01(m).
"Change of Control" means the occurrence of any
of the following events: (i)(A) any "person" (as such
term is used in Section 13(d) and 14(d) of the Exchange
Act), other than (x) Ciba-Geigy Limited and its
Affiliates or (y) an underwriter engaged in a firm
commitment underwriting in connection with a public
offering of the Voting Stock of the Company, is or
becomes the "beneficial owner" (as defined in Rules 13d-3
and 13d-5 under the Exchange Act, except that a person
shall be deemed to have "beneficial ownership" of all
shares that any such person has the right to acquire,
whether such right is exercisable immediately or only
after the passage of time), directly or indirectly, of
more than 25% of the total voting power of the Voting
Stock of the Company; and (B) Ciba-Geigy Limited and its
Affiliates "beneficially own" (as defined in Rules 13d-3
and 13d-5 under the Exchange Act), directly or
indirectly, in the aggregate a lesser percentage of the
total voting power of the Voting Stock of the Company
than such other person "beneficially owns" (as defined in
clause (A)) and do not have the right or ability by
voting power, contract or otherwise to elect or designate
for election a majority of the Board of Directors (for
the purposes of this clause (i), such other person shall
be deemed to beneficially own any Voting Stock of a
specified corporation held by a parent corporation, if
such other person "beneficially owns" (as defined in
clause (A)), directly or indirectly, more than 25% of the
voting power of the Voting Stock of such parent
corporation and Ciba-Geigy Limited and its Affiliates
"beneficially own" (as defined in Rules 13d-3 and 13d-5
under the Exchange Act), directly or indirectly, in the
aggregate a lesser percentage of the voting power of the
Voting Stock of such parent corporation than such other
person "beneficially owns" (as defined in clause (A)) and
do not have the right or ability by voting power,
contract or otherwise to elect or designate for election
a majority of the board of directors of such parent
corporation); (ii) during any period of two consecutive
years, individuals who at the beginning of such period
constituted the Board of Directors of the Company
(together with any new directors whose election by such
Board of Directors or whose nomination for election by
the shareholders of the Company was approved pursuant to
the Governance Agreement or by a vote of 66-2/3% of the
directors of the Company then still in office who were
either directors at the beginning of such period or whose
election or nomination for election was previously so
approved) cease for any reason to constitute a majority
of the Board of Directors then in office; (iii) the
Company sells, conveys, leases or otherwise transfers all
or substantially all its assets to any Person pursuant to
a transaction in which any holder of the Voting Stock of
the Company immediately prior to such transaction
"beneficially owns" (as defined in Rules 13d-3 and 13d-5
under the Exchange Act), directly or indirectly, a lesser
percentage of the Voting Stock of the Person that
acquired such assets immediately after such transaction;
or (iv) the Company shall cease to own and control
(directly or indirectly through one or more wholly owned
Subsidiaries) 100% of the outstanding Capital Stock of
each Subsidiary Guarantor (excluding shares required by
applicable law to be owned by Persons other than the
Company for the qualification of directors or to satisfy
minimum shareholder requirements and except as permitted
pursuant to Section 9.09).
"Ciba-Geigy" means, collectively, Ciba-Geigy
Limited and Ciba-Geigy Corporation, a New York
corporation.
"Ciba-Geigy Limited" means Ciba-Geigy Limited,
a corporation organized and existing under the laws of
Switzerland.
"Ciba-Geigy Transaction Documents" means,
collectively, the Strategic Alliance Agreement, the
Subordinated Notes, the Subordinated Notes Indenture, the
Governance Agreement and all other agreements
contemplated by, or entered into by the Company and its
Subsidiaries pursuant to or in connection with, the
Strategic Alliance Agreement.
"Citibank" means, collectively, Citibank
International and Citibank New York, and their respective
successors and permitted assigns.
"Citibank Letter Agreement" means the fee
letter dated November 16, 1995 from Citicorp Securities,
Inc. and accepted and agreed to by the Company.
"Claim" means any claim or demand, by any
Person, of whatsoever kind or nature for any alleged
Liabilities and Costs, whether based in contract, tort,
implied or express warranty, strict liability, criminal
or civil statute, Permit, ordinance or regulation, common
law or otherwise.
"Closing Date" means the date of the initial
funding of the Loans.
"Collateral" means all Capital Stock and
interests in Capital Stock now owned or hereafter
acquired by the Company upon which a Lien is granted
under any of the Loan Documents.
"Commercial Letter of Credit" means any
documentary letter of credit issued by an Issuing Bank
pursuant to Section 2.04 for the account of any of the
Borrowers that is drawable upon presentation of documents
evidencing the sale or shipment of goods purchased by
such Borrower in the ordinary course of its business.
"Commitments" means, collectively, the
Revolving Credit Commitments and the European Overdraft
Commitments.
"Company Guaranty" means the guaranty duly
executed and delivered to the U.S. Administrative Agent
by the Company substantially in the form of Exhibit H, as
such guaranty may be amended, supplemented or otherwise
modified from time to time.
"Company Pledge Agreement" means the pledge
agreement by and between the Company and the U.S.
Administrative Agent substantially in the form of Exhibit
J, as such pledge agreement may be amended, supplemented
or otherwise modified from time to time.
"Compliance Certificate" is defined in
Section 7.01(d).
"Constituent Documents" means, with respect to
any entity, (i) the articles/certificate of incorporation
(or the equivalent organizational documents) of such
entity, (ii) the by-laws (or the equivalent governing
documents, if any) of such entity and (iii) any document
setting forth the designation, amount and/or relative
rights, limitations and preferences of any class or
series of such entity's Capital Stock.
"Contaminant" means any pollutant, hazardous
substance, radioactive substance, toxic substance,
hazardous waste, radioactive waste, special waste,
petroleum or petroleum-derived substance or waste,
asbestos in any form or condition, polychlorinated
biphenyls (PCBs), or any hazardous or toxic constituent
thereof and includes, but is not limited to, these terms
as defined under Environmental, Health or Safety
Requirements of Law.
"Contractual Obligation", as applied to any
Person, means any provision of any Securities issued by
that Person, or any indenture, mortgage, deed of trust,
security agreement, pledge agreement, guaranty, contract,
undertaking, agreement or instrument to which that Person
is a party or by which it or any of its properties is
bound, or to which it or any of its properties is
subject.
"Credit Suisse" has the meaning assigned to
such term in the Preamble to this Agreement.
"Credit Suisse Letter Agreement" means the fee
letter dated October 17, 1995 from Credit Suisse and
accepted and agreed to by the Company.
"Cure Loans" is defined in
Section 3.02(b)(v)(C).
"Currency Agreement" means any foreign exchange
contract, currency swap agreement or other similar
agreement or arrangement.
"Customary Permitted Liens" means Liens (other
than Environmental Liens and Liens in favor of the PBGC):
(i) with respect to the payment of taxes,
assessments or governmental charges in all
cases that are not yet due or that are being
contested in good faith by appropriate
proceedings and with respect to which adequate
reserves or other appropriate provisions are
being maintained in accordance with GAAP;
(ii) of landlords arising by statute and
Liens of suppliers, mechanics, carriers,
materialmen, warehousemen or workmen and other
Liens imposed by law created in the ordinary
course of business for amounts not yet due or
that are being contested in good faith by
appropriate proceedings and with respect to
which adequate reserves or other appropriate
provisions are being maintained in accordance
with GAAP;
(iii) incurred or deposits made in the
ordinary course of business in connection with
worker's compensation, unemployment insurance
or other types of social security benefits or
to secure the performance of bids, tenders,
sales, contracts (other than for the repayment
of borrowed money), deposits for utility
services and operating Leases, surety, appeal,
customs and performance bonds; provided, that
all such Liens do not in the aggregate
materially detract from the value of the
Company's or any of its Subsidiaries' assets or
Property or materially impair the use thereof
in the operation of the Company's and its
Subsidiaries' businesses;
(iv) arising as a result of progress payments
under Government Contracts;
(v) arising with respect to zoning
restrictions, easements, licenses,
reservations, covenants, rights-of-way, utility
easements, building restrictions and other
similar charges or encumbrances on the use of
Real Property that do not materially interfere
with the ordinary conduct of the business of
the Company or any of its Subsidiaries;
(vi) arising as a result of leases or
subleases of Real Property, provided, that all such
Liens do not in the aggregate materially detract
from the value of the Company's or such Subsidiary's
assets or Property or materially impair the use
thereof in the operation of the businesses;
(vii) constituting the filing of notice
financing statements of a lessor's rights in and to
personal property leased to the Company in the
ordinary course of the Company's business; and
(viii) constituting the filing of notice
financing statements of a Person's rights in and to
personal property delivered to the Company and/or
its Subsidiaries on a consignment basis.
"Danutec Holdings" means Danutec Holdings AG, a
corporation to be organized under the laws of Austria.
"Danutec Holdings Effective Date" is defined in
Section 5.03(a).
"Danutec Werkstoff" means Danutec Werkstoff
GmbH, a corporation to be organized under the laws of
Austria.
"Danutec Werkstoff Effective Date" is defined
in Section 5.03(b).
"Default" means an event which, with the giving
of notice or the lapse of time, or both, would constitute
an Event of Default.
"DIC" means the joint venture entered into
between the Company and Dainippon Ink & Chemicals, Inc.
("Dainippon"), pursuant to that certain Parent Company
Agreement dated as of April 17, 1990 under which the
Company and Dainippon caused Hexcel Technologies, Inc.
and DIC Technologies, Inc., (wholly-owned subsidiaries of
the Company and Dainippon Ink & Chemicals, Inc.,
respectively) to enter into that certain Participants
Agreement dated as of September 14, 1990 pursuant to
which Hexcel Technologies, Inc. and DIC Technologies,
Inc. formed Hexcel-DIC Partnership ("HDP") and pursuant
to which Hexcel Technologies, Inc. and DIC Technologies
Inc., caused HDP to form DIC-Hexcel, Ltd. as a wholly-
owned subsidiary of HDP.
"DOL" means the United States Department of
Labor and any successor department or agency.
"Dollars" and "$" mean the lawful money of the
United States.
"Dollar Equivalent" means, with respect to any
Optional Currency at the time of determination thereof,
the equivalent of such currency in Dollars determined at
the rate of exchange quoted (i) solely with respect to
the Multicurrency Loans and European Overdraft Loans, by
the Administrative Agent pursuant to the provisions of
Section 2.01(a) hereof, and (ii) otherwise, by the
Administrative Agent in New York, New York at 12:00 noon
(New York time) on the date of determination, to prime
banks in New York City for the spot purchase in the New
York foreign exchange market of such amount of Dollars
with such Optional Currency.
"Domestic Subsidiary" means a Subsidiary of the
Company that is organized and existing under the laws of
the United States of America, any State thereof, the
District of Columbia, Puerto Rico or the United States
Virgin Islands.
"Domestic Subsidiary Guaranty" means the
guaranty duly executed and delivered to the U.S.
Administrative Agent by the Domestic Subsidiaries (other
than Hexcel Pottsville Corporation and Hexcel Alpha
Corporation) of the Company substantially in the form of
Exhibit I, as such guaranty may be amended, supplemented
or otherwise modified from time to time.
"EBITDA" means, for any period on a combined
basis for any Person, (i) the sum of the amounts for such
period for such Person of (A) Net Income, (B)
depreciation and amortization expense, (C) total interest
expense, (D) charges for federal, state, local and
foreign income taxes and (E) extraordinary losses
(including restructuring charges) and other nonoperating
expenses that have been deducted in the determination of
Net Income, minus (ii) the sum of (A) extraordinary gains
not already excluded from the determination of Net Income
(including, without limitation, gains in connection with
the sale of Property and gains based upon market
valuation, GAAP valuation or sale of Securities) and (B)
interest and other nonoperating income.
"Eligible Assignee" means (i) a Lender or any
Affiliate thereof; (ii) a commercial bank organized under
the laws of the United States, or any State thereof, and
having total assets in excess of $5,000,000,000; (iii) a
finance company, insurance company, other financial
institution or fund, reasonably acceptable to the
Administrative Agent, that is regularly engaged in
making, purchasing or investing in loans and having total
assets in excess of $5,000,000,000; (iv) a savings and
loan association or savings bank organized under the laws
of the United States or any State thereof that has a net
worth, determined in accordance with GAAP, in excess of
$500,000,000; (v) a commercial bank organized under the
laws of any other country that is a member of the
Organization for Economic Cooperation and Development
(the "OECD"), or a political subdivision of any such
country, and having total assets in excess of
$5,000,000,000, as long as such bank is acting through a
branch or agency located in the country in which it is
organized or another country that is also a member of the
OECD; (vi) the central bank of any country that is a
member of the OECD; or (vii) a finance company, insurance
company, bank, other financial institution or fund
acceptable to the Administrative Agent, which acceptance
shall not be unreasonably withheld; and, in each case, is
capable of making Loans in accordance with the terms
hereof both in the United States and in each country in
which an Optional Currency is the national currency.
"Environmental, Health or Safety Requirements
of Law" means all Requirements of Law derived from or
relating to federal, state and local laws or regulations
relating to or addressing the environment, health or
safety, including but not limited to any law, regulation,
or order relating to the use, handling, or disposal of
any Contaminant, any law, regulation, or order relating
to Remedial Action and any law, regulation, or order
relating to workplace or worker safety and health, and
such Requirements as are promulgated by the specifically
authorized Governmental Authority responsible for
administering such Requirements, each as from time to
time hereafter in effect.
"Environmental Lien" means a Lien in favor of
any Governmental Authority for any (i) liabilities under
any Environmental, Health or Safety Requirements of Law,
or (ii) damages arising from, or costs incurred by such
Governmental Authority in response to, a Release or
threatened Release of a Contaminant into the environment.
"Environmental Property Transfer Acts" means
any applicable Requirement of Law that conditions,
restricts, prohibits or requires any notification or
disclosure triggered by the closure of any Property or
the transfer, sale or lease of any Property or deed or
title for any Property for environmental reasons,
including, but not limited to, any so-called
"Environmental Cleanup Responsibility Acts" or
"Responsible Transfer Acts".
"Equipment" means all of the Company's and its
Subsidiaries' present and future (i) equipment,
including, without limitation, machinery, manufacturing,
distribution, selling, data processing and office
equipment, assembly systems, tools, molds, dies,
fixtures, appliances, furniture, furnishings, vehicles,
vessels, aircraft, aircraft engines, and trade fixtures,
(ii) other tangible personal Property (other than the
Company's and its Subsidiaries' Inventory), and (iii) any
and all accessions, parts and appurtenances attached to
any of the foregoing or used in connection therewith, and
any substitutions therefor and replacements, products and
proceeds thereof.
"ERISA" means the Employee Retirement Income
Security Act of 1974, as amended from time to time, and
any successor statute.
"ERISA Affiliate" means any (i) corporation
that is a member of the same controlled group of
corporations (within the meaning of Section 414(b) of the
Internal Revenue Code) as the Company, (ii) partnership
or other trade or business (whether or not incorporated)
under common control (within the meaning of Section
414(c) of the Internal Revenue Code) with the Company,
and (iii) member of the same affiliated service group
(within the meaning of section 414(m) of the Internal
Revenue Code) as the Company, any corporation described
in clause (i) above or any partnership or trade or
business described in clause (ii) above.
"Eurocurrency Liabilities" has the meaning
assigned to such term in Regulation D.
"Eurocurrency Affiliate" means, with respect to
each Lender, the Affiliate of such Lender (if any) set
forth below such Lender's name under the heading
"Eurocurrency Affiliate" on the signature pages hereof or
on the Assignment and Acceptance by which it became a
Lender or such Affiliate of a Lender as it may from time
to time specify by written notice to the Company and the
Administrative Agent.
"Eurocurrency Interest Payment Date" means
(i) with respect to any Eurocurrency Rate Loan, the last
day of each Interest Period applicable to such Loan,
(ii) with respect to any Eurocurrency Rate Loan requested
by the Company having an Interest Period in excess of
three (3) calendar months, the last day of each three (3)
month interval during such Interest Period, and (iii)
with respect to a Eurocurrency Rate Loan requested by a
Foreign Borrower having an Interest Period in excess of
six (6) calendar months, the last day of each six (6)
calendar month interval during such Interest Period.
"Eurocurrency Rate" means (i) with respect to a
Eurocurrency Loan having an Interest Period of seven (7)
days or any Eurocurrency Loan for which the interest rate
is not ascertainable pursuant to clause (ii) of this
definition, an interest rate per annum obtained by
dividing (A) the interest rate per annum determined by
the Administrative Agent to be the average (rounded
upward to the nearest whole multiple of one-sixteenth of
one percent (0.0625%) per annum if such average is not
such a multiple) of the rates per annum specified by
notice to the Administrative Agent by Citibank, N.A.,
London branch as the rates per annum at which deposits in
Dollars are offered by major banks in the London
interbank market in London, England to the Reference
Banks at approximately 11:00 a.m. (London time) on the
Interest Rate Determination Date for such Interest Period
for a period equal to such Interest Period and in amounts
approximately equal to the Reference Banks' Revolving
Credit Pro Rata Share of the Eurodollar Rate Loan to be
outstanding for such Interest Period with a maturity
equal to such Interest Period, by (B) a percentage equal
to 100% minus the Eurocurrency Reserve Percentage and
(ii) with respect to all other Eurocurrency Loans, the
rate per annum determined by the European Agent by
reference to "Telerate page 3750" or "Telerate page
3740", as appropriate (or if such page on such service
ceases to display such information, such other page as
may replace it on that service for the purpose of display
of such information) to be the rate per annum at which
deposits in such Optional Currency are offered to leading
banks in the London interbank market at approximately
11:00 a.m. (London time) on the Interest Rate
Determination Date for a period equal to such Interest
Period (rounded upward to the nearest whole multiple of
one-sixteenth of one percent (0.0625%) for a period
comparable to the relevant Interest Period. The
Eurocurrency Rate shall be adjusted automatically on and
as of the effective date of any change in the
Eurocurrency Reserve Percentage. For purposes of this
definition, "Telerate page 3750" means the display
designated as "Page 3750", and "Telerate page 3740" means
the display designated as "Page 3740", in each case on
the Telerate Service (or such other page as may replace
Page 3750 or Page 3740 on the service as may be nominated
by the British Bankers' Association as the information
vendor for the purpose of displaying British Bankers'
Association Interest Settlement Rates for deposits in the
currency concerned).
"Eurocurrency Rate Loans" means those Loans
outstanding that bear interest at a rate determined by
reference to the Eurocurrency Rate and the Eurocurrency
Rate Margin as provided in Section 4.01(a).
"Eurocurrency Rate Margin" means four-tenths of
one percent (0.40%) per annum plus, only in the case of
a Eurocurrency Rate Loan of British pounds, any
additional "associated reserve costs" not otherwise
included in the Eurocurrency Reserve Percentage.
"Eurocurrency Reserve Percentage" means, for
any day, that percentage which is in effect on such day,
as prescribed by the Federal Reserve Board for
determining the maximum reserve requirement (including,
without limitation, any emergency, supplemental or other
marginal reserve requirement) for a member bank of the
Federal Reserve System in New York, New York with
deposits exceeding five billion Dollars in respect of
Eurocurrency Liabilities (or in respect of any other
category of liabilities which includes deposits by
reference to which the interest rate on Eurocurrency Rate
Loans is determined or any category of extensions of
credit or other assets which includes loans by a non-
United States office of any bank to United States
residents).
"European Lending Office" means, with respect
to any Lender, the office or offices of such Lender (if
any) set forth below such Lender's name under the heading
"European Lending Office" on the signature pages hereof
or on the Assignment and Acceptance by which it became a
Lender or such office or offices of such Lender as it may
from time to time specify by written notice to the
Company and the Administrative Agent. A Lender may
designate different offices as its "European Lending
Office" with respect to each Optional Currency under its
Revolving Loans, and the term "European Lending Office"
shall refer to any or all such offices, collectively, as
the context may require when used in respect of such
Lender.
"European Overdraft Bank" means Citibank, N.A.,
and its successors and permitted assigns.
"European Overdraft Commitment" means, with
respect to the European Overdraft Bank, the obligation of
the European Overdraft Bank to make European Overdraft
Loans pursuant to the terms and conditions hereof, which
obligation shall not exceed $10,000,000.
"European Overdraft Loan" is defined in Section
2.03(a).
"European Overdraft Note" means one or more
notes evidencing the Borrowers' Obligation to repay the
European Overdraft Loans.
"European Overdraft Obligations" means, at any
particular time, the outstanding principal amount of the
European Overdraft Loans at such time. For purposes of
determining the amount of European Overdraft Obligations
(or any component thereof), such amount shall equal the
Dollar Equivalent of the amount of the Optional Currency
in which such European Overdraft Obligations are
denominated at the time of determination thereof.
"Event of Default" means any of the occurrences
set forth in Section 11.01 after the expiration of any
applicable grace period and the giving of any applicable
notice, in each case as expressly provided in Section
11.01.
"Exchange Act" means the Securities Exchange
Act of 1934, as amended from time to time, and any
successor statute.
"Existing Facility" means the Company's
existing revolving credit facility provided for under the
Credit Agreement dated as of February 8, 1995 among the
Company, the institutions party thereto as Lenders, the
institutions party thereto as Issuing Banks, and Citicorp
USA, Inc., in its separate capacity as agent for the
Lenders and Issuing Banks, as amended, supplemented or
otherwise modified to the date hereof.
"Existing IRDBs" means the industrial revenue
development bonds identified on Schedule 1.01.7.
"Existing Joint Ventures" means (i) Knytex,
(ii) DIC and (iii) Fyfe.
"Fair Market Value" means, with respect to any
asset or group of assets, the value of the consideration
obtainable in a sale of such asset in the open market,
assuming a sale by a willing seller to a willing
purchaser dealing at arm's length and arranged in an
orderly manner over a reasonable period of time, each
having reasonable knowledge of the nature and
characteristics of such asset, neither being under any
compulsion to act, determined (a) in good faith by the
board of directors of such Person; provided, that the
value of any asset or group of assets with a book value
of less than $1,000,000 shall be determined in good faith
by the management of such Person or (b) in an appraisal
of such asset; provided, that such appraisal was
performed relatively contemporaneously with such
determination of the fair market value by an independent
third party appraiser and the basic assumptions
underlying such appraisal have not materially changed
since the date thereof.
"Federal Funds Rate" means, for any period,
(i) in respect of Loans denominated in Dollars, a
fluctuating interest rate per annum equal for each day
during such period to the weighted average of the rates
on overnight federal funds transactions with members of
the Federal Reserve System arranged by federal funds
brokers, as published for such day (or, if such day is
not a Business Day in New York, New York, for the next
preceding Business Day) in New York, New York by the
Federal Reserve Bank of New York, or if such rate is not
so published for any day that is a Business Day in New
York, New York, the average of the quotations for such
day on such transactions received by Citibank from three
federal funds brokers of recognized standing selected by
the Administrative Agent and (ii) in respect of Loans
denominated in an Optional Currency, the Base Rate
applicable to such currency.
"Federal Reserve Board" means the Board of
Governors of the Federal Reserve System or any
Governmental Authority succeeding to its functions.
"Financial Officer" of any Borrower means the
chief executive officer, chief operating officer, senior
vice president for finance and administration, chief
financial officer, treasurer or controller of such
Borrower.
"Fiscal Year" means the fiscal year of the
Company, which shall be the four fiscal quarter period
ending on December 31 of each calendar year.
"Fixed Charges" means, for any period for any
Person, the sum, without duplication, of the amounts for
such period of (i) Interest Expense of such Person, (ii)
the payments of principal on Indebtedness for borrowed
money required to be paid during such period by such
Person, including, without limitation, the principal
component of Capital Lease obligations and (iii) cash
dividends paid in respect of Capital Stock by such
Person.
"Fixed Charge Coverage Ratio" means, with
respect to any period, the ratio of (i) EBITDA of the
Company and its Subsidiaries for such period, minus
Capital Expenditures paid by the Company and its
Subsidiaries during such period, plus Net Cash Proceeds
of the type set forth in clause (i) of the definition
thereof received after the Closing Date received during
such period to the extent not included in the calculation
of EBITDA for such period to (ii) Fixed Charges of the
Company and its Subsidiaries for such period.
"Foreign Currency Protection Agreement" means
any foreign currency cap agreement, foreign currency rate
swap agreement or other similar agreements or
arrangements entered into by the Company or any
Subsidiary to provide protection against fluctuations in
foreign currency rates.
"Foreign Borrowers" means Hexcel Belgium,
Hexcel Lyon, Brochier, Hexcel U.K. and CML, together with
Danutec Holdings and/or Danutec Werkstoff, as applicable,
from and after the Danutec Holdings Effective Date and/or
the Danutec Werkstoff Effective Date, as applicable.
"Foreign Employee Benefit Plan" means any
employee benefit plan as defined in Section 3(3) of
ERISA that is maintained or contributed to for the
benefit of the employees of the Company or any of its
ERISA Affiliates or any of the Company's Subsidiaries,
but which is not covered by ERISA pursuant to ERISA
Section 4(b)(4).
"Foreign Pension Plan" means any Foreign
Employee Benefit Plan that, under applicable local law,
is required to be funded through a trust or other funding
vehicle other than a trust or funding vehicle maintained
by a Governmental Authority.
"Foreign Pledge Agreements" means the pledge
agreements: (i) by and between the Company and the U.S.
Administrative Agent pledging the Company's ownership
interest (other than shares required by applicable law to
be owned by another Person for the qualification of
directors or to satisfy minimum shareholder requirements)
in each of the Foreign Subsidiaries (other than Hexcel
Foreign Sales Corp., Hexcel Chemical Products (U.K.)
Limited and Hexcel do Brasil Servicos S/C Ltda.), and
(ii) by and between each of Hexcel U.K., Hexcel Lyon and
Brochier, on the one hand, and the U.S. Administrative
Agent, on the other hand, pledging each such Foreign
Borrower's ownership interest (other than shares required
by applicable law to be owned by another Person for the
qualification of directors or to satisfy minimum
shareholder requirements) in its Subsidiaries, as each
such pledge agreement may be amended, supplemented or
otherwise modified from time to time.
"Foreign Subsidiary" means any Subsidiary of
the Company other than a Domestic Subsidiary.
"Foreign Subsidiary Guaranties" means the
guaranties duly executed and delivered to the U.S.
Administrative Agent by each of the Foreign Subsidiaries
(other than Hexcel Foreign Sales Corp., Hexcel do Brasil
Servicos S/C Ltda., Salver and CDSR), as each such
guaranty may be amended, supplemented or otherwise
modified from time to time.
"Funded Debt" means, to the extent the
following would be reflected on a consolidated balance
sheet of the Company and its Subsidiaries prepared in
accordance with GAAP, the principal amount of all
Indebtedness of the Company and its Subsidiaries in
respect of borrowed money, evidenced by debt securities,
debentures, acceptances, notes or other similar
instruments, in respect of Capital Leases, in respect of
Reimbursement Obligations or in respect of the deferred
purchase price of Property or services, except accounts
payable and accrued expenses arising in the ordinary
course of business.
"Funding Account Agreement" means that certain
Funding Account Agreement dated as of February 29, 1996,
by and among the Administrative Agent and the Lenders.
"Funding Date" means, with respect to any Loan,
the date of the funding of such Loan.
"Fyfe" means the joint venture entered into
between the Company and Fyfe Associates pursuant to an
Agreement dated as of October 13, 1992, for the sale and
installation of, among other items, high strength
architectural wrap.
"GAAP" means generally accepted accounting
principles set forth in the opinions and pronouncements
of the Accounting Principles Board, the American
Institute of Certified Public Accountants and the
Financial Accounting Standards Board or in such other
statements by such other entity as may be in general use
by significant segments of the accounting profession as
in effect on the date hereof (unless otherwise specified
pursuant to Section 13.04).
"Governance Agreement" means the Governance
Agreement dated as of February __, 1996 by and between
Ciba-Geigy Limited and the Company, as the same may be
amended, supplemented or otherwise modified from time to
time.
"Government Contract" means any bid, quotation,
proposal, contract, agreement, work authorization, lease,
commitment or sale or purchase order of the Company or
its Subsidiaries that is with the United States
Government, or any other Governmental Authority,
including, without limitation, all contracts and work
authorizations to supply goods and services to the United
States Government or its agencies.
"Governmental Authority" means any foreign,
federal, state or local government or other political
subdivision thereof and any entity exercising executive,
legislative, judicial, regulatory or administrative
functions of or pertaining to such government or
political subdivision.
"Hexcel Lyon Subordinated Note" means the
subordinated promissory note in the principal amount of
approximately $2,613,000, dated March 3, 1995, payable by
the Company to Hexcel Lyon and subordinated to the
payment of the Obligations.
"Holder" means any Person entitled to enforce
any of the Obligations, whether or not such Person holds
any evidence of Indebtedness, including, without
limitation, the Administrative Agent, the Syndication
Agent, each Lender and each Issuing Bank.
"Indebtedness" means, as applied to any Person,
at any time, without duplication, (a) all indebtedness,
obligations or other liabilities of such Person (i) for
borrowed money or evidenced by debt securities,
debentures, acceptances, notes or other similar
instruments, and any accrued interest, fees and charges
relating thereto, (ii) in respect of obligations to
redeem, repurchase or exchange any Securities of such
Person or to pay cash dividends in respect of any stock,
(iii) with respect to letters of credit issued for such
Person's account, (iv) to pay the deferred purchase price
of property or services, except accounts payable and
accrued expenses arising in the ordinary course of
business, (v) in respect of Capital Leases, (vi) that are
Accommodation Obligations, (vii) upon which interest
charges are customarily paid (including zero coupon
instruments) or (viii) under conditional sale or other
title retention agreements relating to property purchased
by such Person; (b) all indebtedness, obligations or
other liabilities of such Person or others secured by a
Lien on any property of such Person, whether or not such
indebtedness, obligations or liabilities are assumed by
such Person, all as of such time; and (c) all
indebtedness, obligations or other liabilities of such
Person in respect of Interest Rate Contracts and Currency
Agreements, net of liabilities owed to such Person by the
counterparts thereon.
"Indemnified Matter" is defined in Section
13.03.
"Indemnitee" is defined in Section 13.03.
"Interbank Rate" means, for any period, (i) in
respect of Loans denominated in Dollars, the Federal
Funds Rate, and (ii) in respect of Loans denominated in
any Optional Currency, the Base Rate applicable to such
Optional Currency.
"Interest Expense" means, for any period on a
combined basis for any Person, all of the following as
determined in conformity with GAAP, (i) total interest
expense, whether paid or accrued (without duplication)
(including the interest component of Capital Lease
obligations for such period), including, without
limitation, all commissions, discounts and other fees and
charges owed with respect to letters of credit and net
costs under Interest Rate Contracts, but excluding,
however, (w) amortization of discount, (x) interest paid
in property other than cash and (y) any other interest
expense not payable in cash, minus (ii) any net payments
received during such period under Interest Rate
Contracts.
"Interest Period" is defined in Section
4.02(a).
"Interest Rate Contracts" means interest rate
exchange, swap, collar or cap or similar agreements
providing interest rate protection.
"Interest Rate Determination Date" is defined
in Section 4.02(b).
"Internal Revenue Code" means the Internal
Revenue Code of 1986, as amended to the date hereof and
from time to time hereafter, any successor statute and
any regulations or guidance promulgated thereunder.
"Inventory" means all of the Company's and each
of its Subsidiaries' present and future (i) inventory
(including unbilled accounts receivable), (ii) goods,
merchandise and other personal Property furnished or to
be furnished under any contract of service or intended
for sale or lease, and all goods consigned by the Company
or such Subsidiary and all other items that have
previously constituted Equipment but are then currently
being held for sale or lease in the ordinary course of
the Company's or such Subsidiary's business, (iii) raw
materials, work-in-process and finished goods (other than
raw materials obtained from Ciba-Geigy or any of its
Affiliates on consignment in connection with toll
manufacturing arrangements), (iv) materials and supplies
of any kind, nature or description used or consumed in
the Company's or such Subsidiary's business or in
connection with the manufacture, production, packing,
shipping, advertising, finishing or sale of any of the
Property described in clauses (i) through (iii) above,
(v) goods in which the Company or such Subsidiary has a
joint or other interest to the extent of the Company's or
such Subsidiary's interest therein or right of any kind
(including, without limitation, goods in which the
Company or such Subsidiary has an interest or right as
consignee), and (vi) goods that are returned to or
repossessed by the Company or such Subsidiary; in each
case whether in the possession of the Company or such
Subsidiary, a bailee, a consignee, or any other Person
for sale, storage, transit, processing, use or otherwise,
and any and all documents for or relating to any of the
foregoing.
"Investment" means, with respect to any Person,
(i) any purchase or other acquisition by that Person of
Securities, or of a beneficial interest in Securities
issued by or other equity ownership interest in any other
Person, (ii) any purchase by that Person of all or
substantially all of the assets of a business conducted
by another Person, (iii) any loan, advance (other than
prepaid expenses, accounts receivable, advances to
employees and similar items made or incurred in the
ordinary course of business as presently conducted), or
capital contribution by that Person to any other Person,
including all Indebtedness to such Person arising from a
sale of property by such Person other than in the
ordinary course of its business and (iv) any deposit and
cash collateral accounts with financial institutions.
"Issue" means, with respect to any Letter of
Credit, either to issue, or to extend the expiry of, or
to renew, or to increase the amount of, such Letter of
Credit and the terms "Issued", "Issuing" and "Issuance"
shall have corresponding meanings.
"Issuing Banks" means Citibank, BNP and each
other Lender (or Affiliate of a Lender) approved by the
Administrative Agent and the Company who has agreed to
become an Issuing Bank for the purpose of issuing Letters
of Credit pursuant to Section 2.04.
"Knytex" means the joint venture entered into
between the Company and Owens-Corning Fiberglas
Corporation pursuant to a Limited Liability Company
Agreement dated as of June 14, 1993 for the production
and marketing of, among other items, stitchbonded
fabrics.
"Knytex Credit Facility" means that certain
$4,500,000 revolving credit facility entered into between
Knytex and Creekwood Capital Corporation pursuant to a
Loan Agreement dated as of January 26, 1995.
"Leases" means those leases, tenancies or
occupancies entered into by the Company or one of its
Subsidiaries, as tenant, lessee, sublessor or sublessee
either directly or as the successor in interest to the
Company or any of its Subsidiaries.
"Lender" means, as of the Closing Date,
Citibank, Credit Suisse and each other institution (other
than the Borrowers) that is a signatory hereto and, at
any other given time, each institution that is a party
hereto as a Lender, whether as a signatory hereto or
pursuant to an Assignment and Acceptance.
"Letter of Credit" means any Commercial Letter
of Credit or Standby Letter of Credit.
"Letter of Credit Fee" is defined in Section
4.03(a).
"Letter of Credit Obligations" means, at any
particular time, the sum of (i) all outstanding
Reimbursement Obligations, plus (ii) the aggregate
undrawn face amount of all outstanding Letters of Credit,
plus (iii) the aggregate face amount of all Letters of
Credit requested by any Borrower but not yet issued
(unless the request for an unissued Letter of Credit has
been denied pursuant to Section 2.04(a). For purposes of
determining the amount of Letter of Credit Obligations
(or any component thereof) in respect of any Letter of
Credit that is denominated in an Optional Currency, such
amount shall equal the Dollar Equivalent of the amount of
such Optional Currency at the time of determination
thereof.
"Letter of Credit Reimbursement Agreement"
means, with respect to a Letter of Credit, such form of
application therefor and form of reimbursement agreement
therefor (whether in a single or several documents, taken
together) as the Issuing Bank from which the Letter of
Credit is requested may employ in the ordinary course of
business for its own account, with such modifications
thereto as may be agreed upon by the Issuing Bank and the
applicable Borrower and as are not materially adverse (in
the judgment of the Issuing Bank) to the interests of the
Lenders; provided, that in the event of any conflict
between the terms hereof and of any Letter of Credit
Reimbursement Agreement, the terms hereof shall control.
"Letter of Credit Sublimit" means Thirty
Million Dollars ($30,000,000).
"Leverage Ratio" means, for any period, the
ratio of Funded Debt of the Company and its Subsidiaries
on a consolidated basis as of the end of such period to
EBITDA of the Company and its Subsidiaries for such
period.
"Liabilities and Costs" means all liabilities,
obligations, responsibilities, losses and damages with
respect to or arising out of any of the following:
personal injury, death, punitive damages, economic
damages, consequential damages, treble damages,
intentional, willful or wanton injury, damage or threat
to the environment or public health or welfare, costs and
expenses (including, without limitation, attorney, expert
and consulting fees and costs of investigation,
feasibility or Remedial Action studies), fines, penalties
and monetary sanctions, voluntary disclosures made to, or
settlements with, the United States Government, interest,
direct or indirect, known or unknown, absolute or
contingent, past, present or future, including interest,
if any, thereon.
"Lien" means any mortgage, deed of trust,
pledge, hypothecation, assignment, conditional sale
agreement, deposit arrangement, security interest,
encumbrance, lien (statutory or other), preference,
priority or other security agreement or preferential
arrangement (including, without limitation, any negative
pledge arrangement and any agreement to provide equal and
ratable security) of any kind or nature whatsoever in
respect of any property of a Person intended to assure
payment of any Indebtedness, obligation or other
liability, whether granted voluntarily or imposed by law,
and includes the interest of a lessor under a Capital
Lease or under any financing lease having substantially
the same economic effect as any of the foregoing and the
filing of any financing statement or similar notice
(other than a financing statement filed by a "true"
lessor pursuant to SECTION 9-408 of the Uniform Commercial
Code), naming the owner of such property as debtor, under
the Uniform Commercial Code or other comparable law of
any jurisdiction, but does not include the interest of a
lessor under an Operating Lease.
"Loan Account" is defined in Section 2.05(b).
"Loan Documents" means this Agreement, the
Notes, the Company Guaranty, the Domestic Subsidiary
Guaranty, the Foreign Subsidiary Guaranties, the Company
Pledge Agreement, the Foreign Pledge Agreements, the
Citibank Letter Agreement, the Credit Suisse Letter
Agreement, the Letter of Credit Reimbursement Agreements
(including, without limitation, the Bond LC Reimbursement
Agreement) the other documents executed or delivered
pursuant to Sections 5.01(a) by the Company, any
Subsidiary Guarantor or any other Subsidiary of the
Company, any Currency Agreements and any Interest Rate
Contracts to which the Company or any of its Subsidiaries
and the Administrative Agent or any Affiliate of the
Administrative Agent is a party (in each case entered
into in connection herewith or with the transactions
contemplated hereby), and all other instruments,
agreements and written Contractual Obligations between
the Company or any Subsidiary of the Company, on the one
hand, and any of the Administrative Agent, the
Syndication Agent, the Lenders or the Issuing Banks, on
the other hand, in each case delivered to either the
Administrative Agent, the Syndication Agent, such Lender
or such Issuing Bank pursuant to or in connection with
the transactions contemplated hereby.
"Loans" means, collectively, the Revolving
Loans (including Acquisition Loans), the Swing Loans and
the European Overdraft Loans.
"Lodi Facility" means that certain site located
in Lodi, New Jersey that was sold by the Company to Fine
Organics Corporation in 1986.
"Manufacturing and Supply Agreement" means that
certain Manufacturing and Supply Agreement between the
Company and Ciba-Geigy Corporation dated as of February
29, 1996.
"Margin Stock" means "margin stock" as such
term is defined in Regulation U and Regulation G.
"Material Adverse Effect" means a material
adverse effect upon (i) the business, condition
(financial or otherwise), operations, performance,
properties or prospects of any Borrower individually, or
the Company and its Subsidiaries, taken as a whole,
(ii) the ability of the Borrowers or of the Subsidiary
Guarantors, taken as a whole, to perform their
obligations under the Loan Documents or (iii) the ability
of the Lenders, the Issuing Banks or the Administrative
Agent to enforce the Loan Documents.
"Maximum Partnership/Joint Venture Investment
Amount" means the sum, without duplication, of (i) all
cash Investments made by the Borrower after the Closing
Date, plus (ii) all Investments that the Borrower is
under a Contractual Obligation to make after the Closing
Date, plus (iii) the amount of all Accommodation
Obligations incurred after the Closing Date, in each case
in or on behalf of any partnership in which such Borrower
is a general or limited partner or any joint venture
(other than the Existing Joint Ventures) to which such
Borrower is a party.
"Multicurrency Loan" means a Revolving Loan
made in an Optional Currency.
"Multiemployer Plan" means a "multiemployer
plan" as defined in Section 4001(a)(3) of ERISA which is,
or within the immediately preceding six (6) years was,
contributed to by either the Company or any ERISA
Affiliate.
"Net Assets" means, for any Foreign Borrower
after a sale of assets of such Foreign Borrower, the
aggregate value (as would be reflected on the balance
sheets of such Foreign Borrower in accordance with
ordinary accounting practices in the jurisdiction in
which such Foreign Borrower is located) of the remaining
assets of such Foreign Borrower, taking into account
assets purchased or otherwise acquired by such Foreign
Borrower with the proceeds of such asset sale.
"Net Cash Proceeds" means (i) proceeds received
by the Company or any of its Subsidiaries in cash or Cash
Equivalents from the sale (including, without limitation,
any Sale and Leaseback Transaction but excluding any
payments or proceeds received by or for the account of
the Company with respect to the YIP Transaction to the
extent required to be remitted to First Trust of
California, N.A., as trustee or escrow agent for the
Industrial Development Authority of the County of Los
Angeles), assignment or other disposition, of any
Property, other than sales, assignments and other
dispositions of Property between the Company and its
wholly owned Subsidiaries to the extent permitted
hereunder and sales, assignments and other dispositions
permitted by clause (i), clauses (iii) through (vi) and
clauses (viii) through (ix) of Section 9.02, net of (A)
the reasonable cash costs of sale, assignment or other
disposition (B) taxes paid or payable as a result
thereof, (C) the amount of any Indebtedness (other than
the Obligations) secured by such Property (to the extent
permitted hereunder) and, together with any premiums,
interest or fees, repaid in connection with such sale and
(D) all distributions and other payments required to be
made to any Person (other than the Company or any
Subsidiary of the Company) owning a beneficial interest
in the assets subject to such sale, assignment or other
disposition; provided, that evidence of each of (A), (B)
and (D) are provided to the Administrative Agent;
(ii) proceeds of insurance (other than in respect of
business interruption insurance, protection and indemnity
insurance or other third-party liability insurance)
received on account of the loss of or damage to any such
Property or Properties, and payments of compensation for
any such Property or Properties taken by condemnation or
eminent domain, and (iii) proceeds received after the
Closing Date by the Company or any of its Subsidiaries in
cash or Cash Equivalents from the issuance of any
Indebtedness by the Company or any of its Subsidiaries
(except for such Indebtedness permitted by Section 9.01
and any such Indebtedness incurred in connection with
Currency Agreements or Interest Rate Contracts to the
extent the Borrowers are permitted to enter into such
contracts pursuant to the terms hereof), in each case net
of reasonable costs incurred in connection with such
transaction; provided, that evidence of such costs is
provided to the Administrative Agent.
"Net Income" means, for any period for any
Person, the net income (or loss) after taxes for such
period taken as a single accounting period, determined in
conformity with GAAP.
"Non Pro Rata Loan" is defined in
Section 3.02(b)(v).
"Note" is defined in Section 2.05(a).
"Notice of Borrowing" means, in respect of
Borrowings made on the Closing Date, a notice
substantially in the form of Annex A to the Funding
Account Agreement, and, in respect of all other
Borrowings, a notice substantially in the form of
Exhibit B.
"Notice of Continuation/Conversion" means a
notice substantially in the form of Exhibit C.
"NPL" is defined in Section 6.01(m)(F).
"Obligations" means, to the extent arising
hereunder, under the Notes or under any other Loan
Document, all Loans, advances, debts, liabilities and
obligations owing by the Borrowers or any Domestic
Subsidiary that has executed a Domestic Subsidiary
Guaranty to the Administrative Agent, the Syndication
Agent, any Lender, any Issuing Bank, any Affiliate of the
Administrative Agent, the Syndication Agent, any Lender
or any Issuing Bank, or any Person entitled to
indemnification pursuant to Section 13.03, of any kind or
nature, present or future, whether or not evidenced by
any note, guaranty or other instrument, whether or not
for the payment of money, whether arising (i) under or in
connection with any cash management services provided by
the Administrative Agent or any Affiliate of the
Administrative Agent, or (ii) by reason of (A) an
extension of credit, (B) opening or amendment of a Letter
of Credit or payment of any draft drawn thereunder, (C)
loan, (D) guaranty or (E) indemnification or (iii) in any
other manner, whether direct or indirect (including those
acquired by assignment), absolute or contingent, due or
to become due, now existing or hereafter arising and
however acquired. The term includes, without limitation,
all interest, charges, expenses, fees, reasonable
attorneys' fees and disbursements and any other sum
chargeable to the Borrowers hereunder or under any other
Loan Document.
"Officer's Certificate" means, as to a
corporation or a company, a certificate executed on
behalf of such corporation or company by an officer,
director or general manager, as appropriate, of such
corporation or company.
"Operating Lease" means, as applied to any
Person, any lease of any Property by that Person, as
lessee, that is not a Capital Lease.
"Optional Currency" means any of the lawful
currencies of Austria (Austrian shillings), Belgium
(Belgian francs), France (French francs), Germany
(Deutschmarks), the Netherlands (Netherlands guilders) or
the United Kingdom (British pounds sterling ("Euro
sterling")).
"PBGC" means the Pension Benefit Guaranty
Corporation and any Person succeeding to the functions
thereof.
"Permits" means any permit, approval,
authorization license, variance, facility security
clearance or personnel security clearance, or permission
required from a Governmental Authority under an
applicable Requirement of Law.
"Permitted Existing Accommodation Obligations"
means those Accommodation Obligations of the Company and
its Subsidiaries identified as such on Schedule 1.01.3.
"Permitted Existing Indebtedness" means the
Indebtedness of the Company and its Subsidiaries
identified as such on Schedule 1.01.4.
"Permitted Existing Investments" means those
Investments identified as such on Schedule 1.01.5.
"Permitted Existing Liens" means the Liens on
assets of the Company or any of its Subsidiaries
identified as such on Schedule 1.01.6.
"Permitted Subordinated Indebtedness" means
Indebtedness evidenced or to be evidenced by, or in
respect of, principal and interest on (i) the
Subordinated Debentures not in excess of a principal
amount of $28,500,000, (ii) the Hexcel Lyon Subordinated
Note and (iii) the Subordinated Notes not in excess of an
aggregate principal amount of $43,000,000 and any
adjustments to such amount made in accordance with the
Strategic Alliance Agreement.
"Person" means any natural person, corporation,
limited partnership, limited liability company, general
partnership, joint stock company, joint venture,
association, company, trust, bank, trust company, land
trust, business trust or other organization, whether or
not a legal entity, and any Governmental Authority.
"Plan" means an employee benefit plan defined
in Section 3(3) of ERISA in respect of which the Company
or any ERISA Affiliate is, or within the immediately
preceding six (6) years was, an "employer" as defined in
Section 3(5) of ERISA.
"Process Agent" is defined in Section 13.17.
"Property" means any Real Property or personal
property, including plant, building, facility, structure,
underground storage tank or unit, Equipment, Inventory,
general intangible, receivable, or other asset owned,
leased or operated by the Company or any of its
Subsidiaries, as applicable (including any surface water
thereon or adjacent thereto, and soil and groundwater
thereunder).
"Real Property" means all of the Company's and
each of its Subsidiaries' respective present and future
right, title and interest (including, without limitation,
any leasehold estate) in (i) any plots, pieces or parcels
of land, (ii) any improvements, buildings, structures and
fixtures now or hereafter located or erected thereon or
attached thereto of every nature whatsoever (the rights
and interests described in clauses (i) and (ii) above
being the "Premises"), (iii) all easements, rights of
way, gores of land or any lands occupied by streets,
ways, alleys, passages, sewer rights, water courses,
water and mineral rights and powers, and public places
adjoining such land, and any other interests in property
constituting appurtenances to the Premises, or that
hereafter shall in any way belong, relate or be
appurtenant thereto, (iv) all hereditaments, gas, oil,
minerals (with the right to extract, sever and remove
such gas, oil and minerals), and easements, of every
nature whatsoever, located in or on the Premises and
(v) all other rights and privileges thereunto belonging
or appertaining and all extensions, additions,
improvements, betterments, renewals, substitutions and
replacements to or of any of the rights and interests
described in clauses (iii) and (iv) above.
"Reference Banks" means the London branches of
each of Citibank, N.A. and Credit Suisse.
"Register" is defined in Section 13.01(c).
"Regulation A" means Regulation A of the
Federal Reserve Board as in effect from time to time.
"Regulation D" means Regulation D of the
Federal Reserve Board as in effect from time to time.
"Regulation G" means Regulation G of the
Federal Reserve Board as in effect from time to time.
"Regulation U" means Regulation U of the
Federal Reserve Board as in effect from time to time.
"Regulation X" means Regulation X of the
Federal Reserve Board as in effect from time to time.
"Reimbursement Date" is defined in Section
2.04(d)(i)(A).
"Reimbursement Obligations" means, as to each
of the Borrowers, the aggregate non-contingent
reimbursement or repayment obligations of the Borrowers
with respect to amounts drawn under Letters of Credit.
"Release" means release, spill, emission,
leaking, pumping, injection, deposit, disposal,
discharge, dispersal, leaching or migration into the
indoor or outdoor environment or into or out of any
Property, including the movement of Contaminants through
or in the air, soil, surface water, groundwater or
Property.
"Remedial Action" means actions required to
(i) clean up, remove, treat or in any other way address
Contaminants in the indoor or outdoor environment;
(ii) prevent the Release or threat of Release or minimize
the further Release of Contaminants; or (iii) investigate
and determine if a remedial response is needed and to
design such a response and post-remedial investigation,
monitoring, operation and maintenance and care.
"Reportable Event" means any of the events
described in Section 4043 of ERISA, the reporting of
which has not been waived pursuant to regulations
promulgated thereunder.
"Requirements of Law" means, as to any Person,
the Constituent Documents of such Person, and any law,
rule or regulation, or determination of an arbitrator or
a court or other Governmental Authority, in each case
applicable to or binding upon such Person or any of its
Property or to which such Person or any of its Property
is subject including, without limitation, the Securities
Act, the Exchange Act, Regulations G, U and X, ERISA, the
Fair Labor Standards Act and any certificate of
occupancy, zoning ordinance, building, or land use
requirement or Permit or labor or employment rule or
regulation, including Environmental, Health or Safety
Requirements of Law.
"Requisite Lenders" means, at any time, Lenders
holding, in the aggregate, at least fifty-one percent
(51%) of the then aggregate amount of the Commitments in
effect at such time; provided, that, in the event any of
the Lenders shall have failed to fund its Revolving
Credit Pro Rata Share of any Revolving Loan requested by
any of the Borrowers that such Lenders are obligated to
fund under the terms hereof and any such failure has not
been cured, then for as long as such failure continues,
"Requisite Lenders" means Lenders (excluding Lenders
whose failure to fund their respective Revolving Credit
Pro Rata Share of such Loans have not been so cured)
whose Aggregate Pro Rata Shares represent at least fifty-
one percent (51%) of the Aggregate Pro Rata Shares of
such Lenders; provided, further, that, in the event that
the Commitments have been terminated pursuant to the
terms hereof, "Requisite Lenders" means Lenders (without
regard to such Lenders' performance of their respective
obligations hereunder) whose aggregate ratable shares
(stated as a percentage) of the aggregate outstanding
principal balance of the sum of all Revolving Credit
Obligations plus all European Overdraft Loans are at
least fifty-one percent (51%).
"Restricted Junior Payment" means (i) any
dividend or other distribution, direct or indirect, on
account of any shares of any class of Capital Stock of
the Company or any of its Subsidiaries now or hereafter
outstanding, except a dividend payable solely in (y)
shares of that class of stock and/or (z) shares of any
class of stock that is junior to that class of stock,
(ii) any redemption, retirement, sinking fund or similar
payment, purchase or other acquisition for value, direct
or indirect, of any shares of any class of Capital Stock
of the Company or any of its Subsidiaries now or
hereafter outstanding, (iii) any payment made to redeem,
purchase, repurchase or retire, or to obtain the
surrender of, any outstanding warrants, options or other
rights to acquire shares of any class of Capital Stock of
the Company or any of its Subsidiaries now or hereafter
outstanding and (iv) any payment or prepayment of
principal of, premium, if any, or interest, fees or other
charges on or with respect to, and any redemption,
purchase, retirement, defeasance, sinking fund or similar
payment and any claim for rescission with respect to
Permitted Subordinated Indebtedness.
"Revolving Credit Availability" means, at any
particular time, the amount by which the Revolving Credit
Commitments exceeds the Revolving Credit Obligations
outstanding at such time.
"Revolving Credit Commitment" means, with
respect to any Lender, the obligation of such Lender to
make Revolving Loans and to participate in Letters of
Credit and Swing Loans pursuant to the terms and
conditions hereof, which obligation shall not exceed the
principal amount set forth below such Lender's name
opposite the heading "Revolving Credit Commitment" on the
signature pages hereof or the signature page of the
Assignment and Acceptance by which it became a Lender, as
modified from time to time pursuant to the terms hereof
or to give effect to any applicable Assignment and
Acceptance, and "Revolving Credit Commitments" means the
aggregate principal amount of the Revolving Credit
Commitments of all the Lenders, the maximum aggregate
principal amount of which shall not exceed $165,000,000,
as reduced from time to time pursuant to the terms
hereof.
"Revolving Credit Notes" means notes evidencing
the Borrowers' Obligation to repay the Revolving Loans.
"Revolving Credit Obligations" means, at any
particular time, the sum of (i) the outstanding principal
amount of the Swing Loans at such time, plus (ii) the
outstanding principal amount of the Revolving Loans at
such time, plus (iii) the Letter of Credit Obligations
outstanding at such time. For purposes of determining
the amount of Revolving Credit Obligations (or any
component thereof) in respect of any Revolving Loan that
is denominated in an Optional Currency, such amount shall
equal the Dollar Equivalent of the amount of such
Optional Currency at the time of determination thereof.
"Revolving Credit Pro Rata Share" means with
respect to any Lender, the percentage obtained by
dividing (a) such Lender's Revolving Credit Commitment at
such time by (b) the aggregate amount of all Revolving
Credit Commitments at such time; provided, that if all of
the Revolving Credit Commitments are terminated pursuant
to the terms hereof, then "Revolving Credit Pro Rata
Share" means the percentage obtained by dividing (x) such
Lender's Revolving Credit Obligations by (y) the
aggregate amount of all Revolving Credit Obligations.
"Revolving Credit Sublimit" means, with respect
to each Foreign Borrower, the amount set forth below
opposite such Foreign Borrower's name (it being
understood and agreed that the Company may from time to
time by five (5) Business Days' written notice to the
Administrative Agent (and subject to the Administrative
Agent's consent) reallocate portions of such Revolving
Credit Sublimit to one or more of such Foreign Borrowers
as long as the sum of the portions so allocated does not
at any time exceed $125,000,000):
Hexcel Belgium $15,000,000
Hexcel U.K. $20,000,000
CML $30,000,000
Hexcel Lyon $30,000,000
Brochier $20,000,000
Danutec Holdings
and Danutec Werkstoff $10,000,000;
provided, that the "Revolving Credit Sublimit" of Hexcel
Belgium shall be reduced by the amount of any
Indebtedness incurred by Hexcel Belgium pursuant to
Section 9.01(xi).
"Revolving Credit Termination Date" means the
earlier to occur of (i) the date of termination of the
Revolving Credit Commitments pursuant to the terms hereof
and (ii) February 28, 1999.
"Revolving Loan" is defined in Section 2.01(a).
"Sale and Leaseback Transaction" means, with
respect to any Person, any direct or indirect arrangement
pursuant to which Property is sold or transferred by such
Person and is thereafter leased back from the purchaser
thereof by such Person.
"Salver" means Salver S.r.l., a limited
liability company organized and existing under the laws
of Italy.
"SEC" means Securities and Exchange Commission.
"Securities" means any stock, shares, voting
trust certificates, bonds, debentures, notes or other
evidences of indebtedness, secured or unsecured,
convertible, subordinated or otherwise, or any
certificates of interest, shares, or participation in
temporary or interim certificates for the purchase or
acquisition of, or any right to subscribe to, purchase or
acquire any of the foregoing, but shall not include any
evidence of the Obligations.
"Securities Act" means the Securities Act of
1933, as amended from time to time, and any successor
statute.
"Solvent", when used with respect to any
Person, means that at the time of determination:
(A) (i) the fair market value of its assets
is in excess of the total amount of its liabilities
(including, without limitation, contingent
liabilities); and
(ii) the present fair saleable value of its
assets is greater than its probable liability on its
existing debts as such debts become absolute and
matured; and
(iii) it is then able and expects to be able to
pay its debts (including, without limitation,
contingent debts and other commitments) as they
mature; and
(iv) it has capital sufficient to carry on its
business as conducted and as proposed to be
conducted; and
(B) with respect to Hexcel U.K. and CML only,
such Person is not unable to pay its debts within
the meaning of SECTION 123 of the Insolvency Act of 1986,
and will not become unable to pay its debts within
the meaning of that Section in consequence of its
entry into the Credit Agreement and Transaction
Documents.
"Special Security Agreement" is defined in
Section 7.01(h).
"Specified Equipment" means the mixers
(i) Myers Mod. V550/550A, 30-15-50 H. P. Drivers, 250
Gal. Vacuum Resin Mixing Tank, Screw-Hi Shear & Anchor
w/Insulated, Heated Controls, Explosion Proof, S/N 918
and (ii) Myers Mod. V550/550A, 50-25-75 H. P. Drivers,
500 Gal. Vacuum Resin Mixing Tank, Insulated, Heated,
Screw-Hi Shear & Anchor, Valves, Computer & Controls,
Explosion Proof, S/N 921, together with all attachments
and appurtenances thereto and any related equipment to be
used by the Company to manufacture products pursuant to
the Manufacturing and Supply Agreement.
"Standby Letter of Credit" means any letter of
credit, bank guaranty or similar instrument issued by an
Issuing Bank pursuant to Section 2.04 for the account of
a Borrower that is not a Commercial Letter of Credit.
"Strategic Alliance Agreement" means the
Strategic Alliance Agreement dated as of September 29,
1995 and amended as of December 12, 1995, and as further
amended by the letter agreement dated as of February 28,
1996, among the Company and Ciba-Geigy, as such agreement
may be amended, supplemented or otherwise modified from
time to time.
"Subordinated Debentures" means the 7%
Convertible Subordinated Debentures due 2011 issued by
the Company in the aggregate original principal amount of
up to $35,000,000 and governed by the terms of the
Subordinated Debenture Indenture.
"Subordinated Debenture Indenture" means the
Indenture dated as of August 1, 1986 between the Company
and The Bank of California, N.A., as trustee, as such
agreement may be amended, supplemented or otherwise
modified from time to time.
"Subordinated Notes" means the Increasing Rate
Senior Subordinated Notes due 2003 issued by the Company
in an aggregate principal amount determined in accordance
with the Strategic Alliance Agreement and governed by the
terms of the Subordinated Notes Indenture.
"Subordinated Notes Indenture" means the
Indenture dated as of February 29, 1996 between the
Company and First Trust of California, N.A., as trustee,
as such agreement may be amended, supplemented or
otherwise modified from time to time.
"Subsidiary" of a Person means any corporation
or other entity of which securities or other ownership
interests having ordinary voting power to elect a
majority of the board of directors or other persons
performing similar functions are at the time directly or
indirectly owned or controlled by such Person, one or
more of the other subsidiaries of such Person or any
combination thereof; provided, that Hexcel Foundation
shall not be deemed a Subsidiary of the Company for as
long as it maintains its status as a not-for-profit
corporation for purposes of California law.
"Subsidiary Guarantor" means each Subsidiary of
the Company party to the Domestic Subsidiary Guaranty or
a Foreign Subsidiary Guaranty.
"Swing Loan" is defined in Section 2.02(a).
"Swing Loan Bank" means Citibank New York and
its successors and permitted assigns.
"Swing Loan Note" means one or more notes
evidencing the Company's Obligation to repay the Swing
Loans.
"Tangible Net Worth" means, with respect to any
Person, at any time, (x) total consolidated assets of
such Person plus (y) any negative (or minus any positive)
cumulative foreign currency translation adjustments
applicable to such Person minus (z) total consolidated
liabilities of such Person plus any negative (or minus
any positive) minimum pension obligation adjustment
included in the shareholders' equity account of such
Person, each as determined in accordance with GAAP,
excluding, however, from the determination of total
assets (i) goodwill, organizational expenses, trademarks,
tradenames, copyrights, patents, patent applications,
licenses and rights in any thereof, and other similar
intangibles, (ii) deferred charges or unamortized debt
discount and expense, (iii) securities that are not
readily marketable, (iv) cash held in a sinking or other
analogous fund established for the purpose of redemption,
retirement or prepayment of capital stock or
Indebtedness, (v) any write-up in the book value of any
asset resulting from a revaluation thereof subsequent to,
in the case of the Acquired Businesses, September 29,
1995, and, in the case of the assets of the Company and
its Subsidiaries, December 31, 1995, and (vi) any items
not included in clauses (i) through (vi) above that are
treated as intangibles in accordance with GAAP.
"Taxes" is defined in Section 3.03(a).
"Termination Event" means (i) a Reportable
Event with respect to any Benefit Plan; (ii) the
withdrawal of the Company or any ERISA Affiliate from a
Benefit Plan during a plan year in which the Company or
such ERISA Affiliate was a "substantial employer" as
defined in Section 4001(a)(2) of ERISA or the cessation
of operations that results in the termination of
employment of 20% of Benefit Plan participants who are
employees of the Company or any ERISA Affiliate; (iii)
the imposition of an obligation on the Company or any
ERISA Affiliate under Section 4041 of ERISA to provide
affected parties written notice of intent to terminate a
Benefit Plan in a distress termination described in
Section 4041(c) of ERISA; (iv) the institution by the
PBGC or any similar foreign Governmental Authority of
proceedings to terminate a Benefit Plan or a Foreign
Pension Plan; (v) any event or condition that would
reasonably constitute grounds under Section 4042 of ERISA
for the termination of, or the appointment of a trustee
to administer, any Benefit Plan; (vi) a foreign
Governmental Authority shall appoint or institute
proceedings to appoint a trustee to administer any
Foreign Pension Plan; or (vii) the partial or complete
withdrawal of the Company or any ERISA Affiliate from a
Multiemployer Plan or a Foreign Pension Plan.
"Transaction Costs" means the fees, costs and
expenses payable by the Borrowers in connection with the
execution, delivery and performance of the Transaction
Documents.
"Transaction Documents" means the Loan
Documents, the Ciba-Geigy Transaction Documents, the
Hexcel Lyon Subordinated Note and all other agreements or
instruments executed and delivered or to be executed and
delivered pursuant hereto or thereto or in connection
herewith or therewith or any of the transactions
contemplated hereby or thereby.
"Uniform Commercial Code" means the Uniform
Commercial Code as enacted in the State of New York, as
it may be amended from time to time.
"Unused Commitment Fee" is defined in
Section 4.03(b).
"Unused Commitment Fee Rate" means, as of any
date, three-sixteenths of one percent (0.1875%) per
annum.
"U.S. Lending Office" means, with respect to
any Lender, such Lender's office, located in the United
States, specified as the "U.S. Lending Office" under its
name on the signature pages hereof or on the Assignment
and Acceptance by which it became a Lender or such other
United States office of such Lender as it may from time
to time specify by written notice to the Company and the
Administrative Agent.
"Voting Stock" means, with respect to any
Person, securities with respect to any class or classes
of Capital Stock of such Person entitling the holders
thereof (whether at all times or only as long as no
senior class of stock has voting power by reason of any
contingency) to vote in the election of members of the
board of directors of such Person.
"wholly owned Subsidiary" of a Person means a
corporation, company having limited liability or societe
anonyme, 100% of the Capital Stock of which is owned,
directly or indirectly, by such Person (other than shares
required by applicable law to be owned by another Person
for the qualification of directors or to satisfy minimum
shareholder requirements).
"YIP Transaction" means the transaction
pursuant to which BCY Industrial Enterprises acquired the
Company's Real Property located in The City of Industry,
California by assuming the Company's obligation to repay
$2,340,000 in aggregate principal amount of Existing
IRDBs issued by the Industrial Development Authority of
the County of Los Angeles to finance such Real Property.
1.02. Computation of Time Periods. In this
Agreement, in the computation of periods of time from a
specified date to a later specified date, the word "from"
means "from and including" and the words "to" and "until"
each mean "to but excluding". Periods of days referred
to in this Agreement shall be counted in calendar days
unless Business Days are expressly prescribed. Any
period determined hereunder by reference to a month or
months or year or years shall end on the day in the
relevant calendar month in the relevant year, if
applicable, immediately preceding the date numerically
corresponding to the first day of such period, provided,
that if such period commences on the last day of a
calendar month (or on a day for which there is no
numerically corresponding day in the calendar month
during which such period is to end), such period shall,
unless otherwise expressly required by the other
provisions of this Agreement, end on the last day of the
calendar month.
1.03. Accounting Terms. Subject to
Section 13.04, for purposes of this Agreement, all
accounting terms not otherwise defined herein shall have
the meanings assigned to them in conformity with GAAP.
1.04. Other Definitional Provisions.
References to "Articles", "Sections", "subsections",
"Schedules" and "Exhibits" shall be to Articles,
Sections, subsections, Schedules and Exhibits,
respectively, of this Agreement unless otherwise
specifically provided. The words "hereof", "herein", and
"hereunder" and words of similar import when used in this
Agreement shall refer to this Agreement as a whole and
not to any particular provision of this Agreement.
1.05. Other Terms. All other terms contained
herein shall, unless the context indicates otherwise,
have the meanings assigned to such terms by the Uniform
Commercial Code to the extent the same are defined
therein.
ARTICLE II
AMOUNTS AND TERMS OF LOANS
2.01. Revolving Credit Facility. (a) Subject
to the terms and conditions set forth herein, each Lender
hereby severally and not jointly agrees to make revolving
loans (each individually, a "Revolving Loan" and,
collectively, the "Revolving Loans") to the Borrowers
from time to time during the period from the Closing Date
to the Revolving Credit Termination Date, in an aggregate
amount (in the case of a Multicurrency Loan, converted to
the Dollar Equivalent thereof) not to exceed at any time
outstanding such Lender's Revolving Credit Commitment at
such time; provided, that (i) the aggregate amount of the
Revolving Loans made to the Borrowers by each Lender on a
Funding Date shall not exceed the Dollar amount of such
Lender's Revolving Credit Pro Rata Share of the Revolving
Credit Availability on such Funding Date, and (ii) the
aggregate outstanding amount of Revolving Loans made to
any Foreign Borrower shall not exceed at any time such
Foreign Borrower's Revolving Credit Sublimit in effect at
such time. All Revolving Loans comprising the same
Borrowing hereunder shall be made by such Lenders
simultaneously and proportionately to their respective
Revolving Credit Commitments. Subject to the provisions
hereof (including, without limitation, Section 5.02), any
of the Borrowers may repay any outstanding Revolving Loan
on any day that is a Business Day and any amounts so
repaid may be reborrowed, up to the amount available
under this Section 2.01(a) at the time of such Borrowing,
until the Revolving Credit Termination Date. Borrowings
of Revolving Loans that are not Multicurrency Loans shall
be in an aggregate minimum amount of $2,000,000 and
integral multiples of $1,000,000 in excess of that
amount. Borrowings of Multicurrency Loans shall be
denominated in a single Optional Currency in an aggregate
minimum amount equal to an integral multiple of 100,000
units in such Optional Currency and (converted to the
Dollar Equivalent thereof) equal to or greater than
$2,000,000; provided, that in the case of any Borrowing
of Multicurrency Loans the proceeds of which shall be
used to repay a then maturing Borrowing denominated in
the same Optional Currency, such new Borrowing may,
subject to the terms and conditions otherwise set forth
herein, be in an aggregate principal amount equal to the
aggregate principal amount of such maturing Borrowing.
For the purposes of determining compliance with this
Section 2.01(a), the Dollar Equivalent of a Multicurrency
Loan in an Optional Currency shall be determined by the
Administrative Agent upon receipt from any Borrower of
the Notice of Borrowing requesting such Multicurrency
Loan, and such Dollar Equivalent shall be recalculated on
each date that it shall be necessary to determine the
unused portion of each Lender's Revolving Credit
Commitment or any or all of the Loans outstanding on such
date.
(b) Notice of Borrowing. When the Company
desires to borrow under this Section 2.01, it shall
deliver to the U.S. Administrative Agent an irrevocable
Notice of Borrowing, signed by it, (x) on or before the
Closing Date, in the case of a Borrowing of Revolving
Loans on the Closing Date, and (y) no later than 11:00
a.m. (New York time) (I) on the proposed Funding Date, in
the case of a Borrowing of Base Rate Loans denominated in
Dollars after the Closing Date, and (II) no later than
11:00 a.m. (London time) at least three (3) Business Days
in advance of the proposed Funding Date, in the case of a
Borrowing of Eurocurrency Rate Loans after the Closing
Date. All Borrowings by the Company shall be in Dollars.
When any Foreign Borrower desires to borrow under this
Section 2.01, it shall deliver to the European
Administrative Agent an irrevocable Notice of Borrowing,
signed by it, (x) on or before the Closing Date, in the
case of a Borrowing of Revolving Loans on the Closing
Date, and (y) no later than 11:00 a.m. (London time) at
least three (3) Business Days in advance of the proposed
Funding Date, in the case of a Borrowing after the
Closing Date. Either such Notice of Borrowing shall
specify (i) the proposed Funding Date (which shall be a
Business Day), (ii) the amount of the proposed Borrowing,
(iii) whether the proposed Borrowing will be of Base Rate
Loans or Eurocurrency Rate Loans, (iv) in the case of
Eurocurrency Rate Loans, the requested Interest Period,
(v) instructions for the disbursement of the proceeds of
the proposed Borrowing and (vi) in the case of
Multicurrency Loans to a Foreign Borrower, the Optional
Currency in which such Borrowing of Multicurrency Loans
is to be denominated.
(c) Making of Revolving Loans. (i) (A) With
respect to Loans to be made on the Closing Date, the
Administrative Agent shall have notified each Lender in
advance by telex or telecopy, or other similar form of
transmission, of the proposed Borrowing pursuant to the
terms of the Funding Account Agreement. In the case of a
Borrowing by the Company, each Lender shall deposit an
amount equal to its Revolving Credit Pro Rata Share of
the amount requested by the Company to be made as
Revolving Loans with the U.S. Administrative Agent at its
office in New York, New York, in immediately available
funds, on the Closing Date specified in the initial
Notice of Borrowing in accordance with the terms of the
Funding Account Agreement. In the case of a Borrowing by
a Foreign Borrower, each Lender shall deposit an amount
in the requested Optional Currency or in Dollars equal to
its Revolving Credit Pro Rata Share of the amount
requested by such Foreign Borrower to be made as
Revolving Loans with the European Administrative Agent at
its office in London, England, in immediately available
funds, on the Closing Date specified in the initial
Notice of Borrowing in accordance with the terms of the
Funding Account Agreement. (B) Promptly after receipt of
a Notice of Borrowing under Section 2.01(b), the
Administrative Agent shall notify each Lender by telex or
telecopy, or other similar form of transmission, of the
proposed Borrowing. In the case of a Borrowing by the
Company, each Lender shall deposit an amount equal to its
Revolving Credit Pro Rata Share of the amount requested
by the Company to be made as Revolving Loans with the
U.S. Administrative Agent at its office in New York, New
York, in immediately available funds, not later than 4:00
p.m. (New York time) on any other Funding Date specified
in a Notice of Borrowing. In the case of a Borrowing by
a Foreign Borrower, each Lender shall deposit an amount
in the requested Optional Currency or in Dollars equal to
its Revolving Credit Pro Rata Share of the amount
requested by such Foreign Borrower to be made as
Revolving Loans with the European Administrative Agent at
its office in London, England, in immediately available
funds, not later than 11:00 a.m. (London time) on any
other Funding Date specified in a Notice of Borrowing.
(C) Subject to the fulfillment of the conditions
precedent set forth in Section 5.01 or Section 5.02, as
applicable, (x) the proceeds of the Loans requested by
the Company in any Notice of Borrowing shall be made
available to the Company, in immediately available funds,
at the U.S. Administrative Agent's office in New York,
New York on such Funding Date (or on the date received if
later than such Funding Date) and (y) the proceeds of the
Loans requested by any Foreign Borrower in any Notice of
Borrowing shall be made available to such Foreign
Borrower, in immediately available funds, at the European
Administrative Agent's office in London, England on such
Funding Date (or, subject to Section 2.01(c)(iv), on the
date received if later than such Funding Date). All
proceeds of Loans shall be disbursed by the
Administrative Agent to the disbursement account
indicated in the applicable Notice of Borrowing. The
failure of any Lender to deposit the amount described
above with the Administrative Agent on the applicable
Funding Date shall not relieve any other Lender of its
obligations hereunder to make its Revolving Loan on such
Funding Date or prejudice any rights that any Borrower
may have against such Lender as a result of any such
default by such Lender. No Lender shall be responsible
for any failure by any other Lender to perform its
obligation to make a Revolving Loan hereunder nor shall
the Revolving Credit Commitment of any Lender be
increased or decreased as a result of any such failure.
(ii) Anything hereinabove to the contrary
notwithstanding, if any Lender shall, not later than
10:00 a.m. (London time) two Business Days before the
date of any requested Borrowing of Multicurrency Loans,
notify the Administrative Agent that such Lender is not
satisfied that deposits in the relevant Optional Currency
will be freely available to it in the relevant amount and
for the relevant Interest Period, the right of the
Borrowers to request Multicurrency Loans in such Optional
Currency from such Lender as part of such Borrowing or
any subsequent Borrowing of Multicurrency Loans shall be
suspended until such Lender shall notify the
Administrative Agent that the circumstances causing such
suspension no longer exist, and, at the option of the
Borrowers, either (i) the applicable Notice of Borrowing
may be withdrawn and such Borrowing shall not be made, or
(ii) the Multicurrency Loan to be made by such Lender as
part of such Borrowing (and the Multicurrency Loan to be
made by such Lender as part of any subsequent Borrowing
of Multicurrency Loans in respect of which such Optional
Currency shall have been requested during such period of
suspension) shall be a Eurocurrency Rate Loan denominated
in Dollars and having an Interest Period coextensive with
the Interest Period in effect in respect of all other
Multicurrency Loans comprising a part of such Borrowing.
If any Borrower elects to withdraw its Notice of
Borrowing, such Borrower shall be liable to each other
Lender for any damages suffered on account thereof of a
nature described in Section 4.02(e). The Administrative
Agent shall, upon receiving notice from such Lender that
the circumstances causing any such suspension no longer
apply, promptly so notify the Borrowers; provided, that
the failure of the Administrative Agent to so notify the
Borrowers shall not impair the rights of the Lenders
under this Section 2.01(c)(ii) or expose the
Administrative Agent to any liability.
(iii) Each Notice of Borrowing shall be
irrevocable and binding (except as set forth in clause
(ii) of this Section 2.01(c)) on the Borrowers on whose
behalf it shall have been submitted.
(iv) Unless the Administrative Agent shall
have been notified by any Lender on the applicable
Funding Date in respect of any Borrowing of Revolving
Loans that such Lender does not intend to fund its
Revolving Loan requested to be made on such Funding Date,
the Administrative Agent may assume that such Lender has
funded its Revolving Loan and is depositing the proceeds
thereof with the Administrative Agent on the Funding
Date, and the Administrative Agent in its sole discretion
may, but shall not be obligated to, disburse, in
immediately available funds, a corresponding amount to
the Borrowers on the Funding Date. If the Revolving Loan
proceeds corresponding to that amount are advanced to the
Borrowers by the Administrative Agent but are not in fact
deposited with the Administrative Agent by such Lender on
or prior to the applicable Funding Date, such Lender
agrees to pay, and in addition each Borrower agrees to
repay, to the Administrative Agent forthwith on demand
such corresponding amount, together with interest
thereon, for each day from the date such amount is
disbursed to or for the benefit of the Borrowers until
the date such amount is paid or repaid to the
Administrative Agent, (A) in the case of the Borrowers,
at the interest rate applicable to such Borrowing and
(B) in the case of such Lender, at the Interbank Rate.
If such Lender shall pay to the Administrative Agent the
corresponding amount, the amount so paid shall constitute
such Lender's Revolving Loan, and if both such Lender and
the Borrowers shall pay and repay such corresponding
amount, the Administrative Agent shall promptly pay to
the Borrowers such corresponding amount. This Section
2.01(c)(iv) does not relieve any Lender of its obligation
to make its Revolving Loan on any Funding Date or
prejudice any rights that any Borrower may have against
such Lender as a result of any such default by such
Lender.
(d) Use of Proceeds of Revolving Loans.
Proceeds of the Acquisition Loans shall be used by the
Company and/or its Subsidiaries (x) to fund the
$25,000,000 cash payment to be made by the Company and/or
its Subsidiaries to Ciba-Geigy and/or its Subsidiaries in
connection with the Acquisition and (y) to pay
Transaction Costs incurred in connection with the
Acquisition. Proceeds of the Revolving Loans not
constituting Acquisition Loans shall be used (i) on the
Closing Date or promptly thereafter, (A) by the Company
and certain of its Subsidiaries to repay certain
Permitted Existing Indebtedness of the Company and
certain of its Subsidiaries (including, without
limitation, repayment in full of the obligations of the
Company under the Existing Facility) and (B) by the
Company and/or its Subsidiaries to pay Transaction Costs
(other than those incurred in connection with the
Acquisition) and (ii) thereafter, by each Borrower to
provide for ongoing working capital needs in the ordinary
course of the business of such Borrower and such
Borrower's Subsidiaries and for other lawful general
corporate purposes not prohibited hereunder; provided,
that Revolving Loans made to Danutec Werkstoff, CML and
Brochier cannot be used to repay the Acquisition Loan
used to acquire Danutec Werkstoff, CML and Brochier,
respectively.
(e) Revolving Credit Termination Date. The
Revolving Credit Commitments shall terminate, and all
outstanding Obligations shall be paid in full in cash
(or, in the case of unmatured Letter of Credit
Obligations, the Borrowers shall comply with Section
2.04(a)), on the Revolving Credit Termination Date. Each
Lender's obligation to make Revolving Loans shall
terminate at the close of business in New York City on
the Business Day next preceding the Revolving Credit
Termination Date.
2.02. Swing Loans. (a) Availability.
Subject to the terms and conditions set forth herein, the
Swing Loan Bank may, in its sole discretion, make loans
(the "Swing Loans") to the Company, from time to time
during the period from the day immediately following the
Closing Date to the Revolving Credit Termination Date, up
to an aggregate principal amount at any one time
outstanding which shall not exceed at any time
outstanding an amount equal to the lesser of
(i) $10,000,000 and (ii) the Swing Loan Bank's Revolving
Credit Availability at such time. The Swing Loan Bank
shall have no duty to make or to continue to make Swing
Loans. All Swing Loans shall be payable on demand with
accrued interest thereon and shall be secured as part of
the Obligations by the Collateral and shall, except as
expressly provided in this Section 2.02, otherwise be
subject to all the terms and conditions applicable to
Revolving Loans, except that (x) Swing Loans shall be in
minimum amounts of $1,000,000 and (y) all interest on the
Swing Loans made by the Swing Loan Bank shall be payable
to the Swing Loan Bank solely for its own account.
(b) Notice of Borrowing. When the Company
desires to borrow under this Section 2.02, it shall
deliver to the Administrative Agent an irrevocable Notice
of Borrowing, signed by it, no later than 12:30 p.m. (New
York time) on the day of the proposed Borrowing of a
Swing Loan. Such Notice of Borrowing shall specify
(i) the proposed Funding Date (which shall be a Business
Day), (ii) the amount of the proposed Borrowing, and
(iii) instructions for the disbursement of the proceeds
of the proposed Borrowing. All Swing Loans shall be Base
Rate Loans denominated in Dollars.
(c) Making of Swing Loans. The Swing Loan
Bank shall deposit the amount it intends to fund, if any,
in respect of the Swing Loans requested by the Company
with the Administrative Agent at its office in New York,
New York not later than 3:00 p.m. (New York time) in
immediately available funds on the date of the proposed
Borrowing applicable thereto. The Swing Loan Bank shall
not make any Swing Loan in the period commencing on the
first Business Day after it has notice that one or more
of the conditions precedent contained in Section 5.02
shall not on such date be satisfied, and ending when such
conditions are satisfied, and the Swing Loan Bank shall
not otherwise be required to determine that, or take
notice whether, the conditions precedent set forth in
Section 5.02 hereof have been satisfied in connection
with the making of any Swing Loan. Subject to the
preceding sentence, the Administrative Agent shall make
such proceeds of each funding of a Swing Loan available
to the Company in immediately available funds at the
Administrative Agent's office in New York, New York on
the date of the proposed Borrowing and shall disburse
such proceeds to the disbursement account in the
applicable Notice of Borrowing.
(d) Repayment of Swing Loans. The Company
shall repay the outstanding Swing Loans owing to the
Swing Loan Bank (i) upon the earlier of (A) demand by the
Swing Loan Bank and (B) the Revolving Credit Termination
Date. In the event that the Company fails to repay any
Swing Loan, together with interest thereon, as set forth
in the first sentence of this paragraph, then, upon the
request of the Swing Loan Bank, each Lender shall make
Revolving Loans to the Company (irrespective of the
satisfaction of the conditions in Section 5.02 or the
requirement to deliver a Notice of Borrowing in Section
2.02(b), which conditions and requirement such Lenders
irrevocably waive) in an amount equal to such Lender's
Revolving Credit Pro Rata Share of the aggregate amount
of the Swing Loans then outstanding (net of that portion
of such Swing Loan, if any, owing to such Lender in its
capacity as a Swing Loan Bank) after giving effect to any
prepayments and repayments made by the Company, and the
Company hereby authorizes the Administrative Agent to
apply the proceeds of such Revolving Loans to the
repayment of such Swing Loans. To the extent the
Administrative Agent receives any amounts in prepayment
or repayment of outstanding Revolving Loans prior to such
request, the Administrative Agent shall apply such
amounts when received to the repayment of the Swing Loans
then outstanding. The failure of any Lender to make
available to the Administrative Agent its Revolving
Credit Pro Rata Share of such Revolving Loans shall not
relieve any other Lender of its obligation hereunder to
make available to the Administrative Agent such other
Lender's Revolving Credit Pro Rata Share of such
Revolving Loans on the date of such request or prejudice
any rights that any Borrower may have against such Lender
as a result of any such default by such Lender. No
Lender shall be responsible for any failure by any other
Lender to perform its obligations to make such Revolving
Loans hereunder nor shall the Revolving Credit Commitment
of any Lender be increased or decreased as a result of
such failure.
(e) Use of Proceeds of Swing Loans. The
proceeds of the Swing Loans may be used to provide for
the short-term working capital needs of the Company and
its Subsidiaries and for any other lawful corporate
purposes not prohibited hereunder.
2.03. European Overdraft Facility. (a)
Availability. Subject to the terms and conditions set
forth herein, the European Overdraft Bank shall make
loans (the "European Overdraft Loans") to the Foreign
Borrowers, from time to time during the period from the
day immediately following the Closing Date to the
Revolving Credit Termination Date, up to an aggregate
principal amount at any time outstanding which shall not
exceed $10,000,000. All European Overdraft Loans shall
be payable on demand with accrued interest thereon and
shall be secured as part of the Obligations by the
Collateral and shall, except as expressly provided in
this Section 2.03, otherwise be subject to all the terms
and conditions applicable to Revolving Loans, except that
each European Overdraft Loan shall be denominated in a
single Optional Currency and shall not be subject to a
minimum borrowing requirement.
(b) Making of European Overdraft Loans. All
European Overdraft Loans shall be made available to the
Foreign Borrowers at the office of the European Overdraft
Bank in London in immediately available funds on the date
of the proposed Borrowing applicable thereto. The
European Overdraft Bank shall not make any European
Overdraft Loan in the period commencing on the first
Business Day after it has notice that one or more of the
conditions precedent contained in Section 5.02 shall not
on such date be satisfied, and ending when such
conditions are satisfied, and the European Overdraft Bank
shall not otherwise be required to determine that, or
take notice whether, the conditions precedent set forth
in Section 5.02 hereof have been satisfied in connection
with the making of any European Overdraft Loan.
(c) Repayment of European Overdraft Loans. A
Foreign Borrower shall repay the outstanding European
Overdraft Loans owing by it to the European Overdraft
Bank at any time, but in no event later than (i) the
earlier of (A) demand by the European Overdraft Bank and
(B) the Revolving Credit Termination Date.
(d) Use of Proceeds of European Overdraft
Loans. The proceeds of the European Overdraft Loans may
be used to provide for ongoing working capital needs in
the ordinary course of the business of the Foreign
Borrowers and their respective Subsidiaries and for any
other lawful corporate purposes not prohibited hereunder.
2.04. Letters of Credit. Subject to the terms
and conditions set forth herein, each Issuing Bank hereby
severally agrees to Issue from time to time, for the
account of any Borrower, one or more Letters of Credit,
up to an aggregate face amount at any one time
outstanding equal to the Letter of Credit Sublimit,
subject to the following provisions:
(a) Types and Amounts. An Issuing Bank shall
not have any obligation to Issue, and shall not, except
as otherwise agreed by the Requisite Lenders and such
Issuing Bank, Issue any Letter of Credit if:
(i) the aggregate Letter of Credit
Obligations with respect to such Issuing Bank,
after giving effect to the Issuance of the
Letter of Credit requested hereunder, shall
exceed any limit imposed by law or regulation
upon such Issuing Bank;
(ii) such Issuing Bank receives written
notice (A) from the Administrative Agent at or
before 11:00 a.m. (New York time) on the
Business Day immediately preceding the date of
the proposed Issuance of such Letter of Credit
that immediately after giving effect to the
Issuance of such Letter of Credit, (I) the
Revolving Credit Obligations at such time would
exceed the Revolving Credit Commitments at such
time, (II) the Letter of Credit Obligations at
such time would exceed the Letter of Credit
Sublimit at such time or (III) with respect to
any Foreign Borrower, the Revolving Credit
Obligations of the Foreign Borrower for whose
account such Letter of Credit is being Issued
would exceed such Foreign Borrower's Revolving
Credit Sublimit in effect at such time or
(B) from the Administrative Agent or any of the
Lenders at or before 11:00 a.m. (New York time)
on the Business Day immediately preceding the
date of the proposed Issuance of such Letter of
Credit that one or more of the conditions
precedent contained in Sections 5.01 or 5.02,
as applicable, would not on such date be
satisfied (or waived pursuant to Section
13.07), unless such conditions are thereafter
satisfied or waived and written notice of such
satisfaction or waiver is given to such Issuing
Bank by the Administrative Agent (it being
understood that such Issuing Bank shall not
otherwise be required to determine that, or
take notice whether, the conditions precedent
set forth in Sections 5.01 or 5.02, as
applicable, have been satisfied or waived); or
(iii) such Letter of Credit has an
expiration date later than (A) the date one (1)
year after the date of Issuance (after taking
into account any automatic renewal provisions
thereof) or (B) the Business Day next preceding
the Revolving Credit Termination Date;
provided, that, at the request of any Borrower,
the Administrative Agent may, but shall not be
obligated to, request such Issuing Bank to
Issue a Letter of Credit with an expiration
date after the date in clause (A) or (B) above;
or
(iv) such Letter of Credit is in a currency
other than Dollars or an Optional Currency.
If the Administrative Agent decides, in its sole
discretion, to request any Issuing Bank to Issue a Letter
of Credit pursuant to the proviso in clause (iii) above,
the Borrower for whose account such Letter of Credit is
being Issued agrees that on the Revolving Credit
Termination Date it shall deposit with the Administrative
Agent for the benefit of the Lenders and such Issuing
Bank with respect to such Letter of Credit cash or Cash
Equivalents (in each case, in the currency in which such
Letter of Credit is denominated) equal to 105% of the
greatest amount that such Letter of Credit may be drawn.
Such deposits shall be held as Cash Collateral by the
Administrative Agent for the benefit of the Lenders and
any such Issuing Bank as security for, and to provide for
the payment of, the Reimbursement Obligations therefor.
(b) Conditions. In addition to being subject
to the satisfaction of the conditions precedent contained
in Sections 5.01 and 5.02, as applicable, the obligation
of an Issuing Bank to Issue any Letter of Credit is
subject to the satisfaction in full of the following
conditions:
(i) if the Issuing Bank so requests, the
applicable Borrower shall have executed and
delivered to such Issuing Bank and the
Administrative Agent a Letter of Credit
Reimbursement Agreement and such other
documents and materials as may be reasonably
required pursuant to the terms thereof;
(ii) the terms of the proposed Letter of
Credit shall conform substantially to the
customary terms of letters of credit issued by
the Issuing Bank as in existence on the date of
such Issuance; and
(iii) with respect to any Letter of Credit
that is in an Optional Currency, the Issuing
Bank shall be reasonably satisfied that
deposits in the relevant Optional Currency will
be freely available to it for the relevant
period of time.
(c) Issuance of Letters of Credit. (i) Any
Borrower shall give an Issuing Bank and the
Administrative Agent written notice that it has selected
such Issuing Bank to Issue a Letter of Credit (A) not
later than 11:00 a.m. (New York time) on the third
Business Day preceding the requested date for Issuance of
any Letter of Credit hereunder that is in Dollars and (B)
not later than 11:00 a.m. (London time) on the fourth
Business Day preceding the requested date for Issuance of
any Letter of Credit hereunder that is in an Optional
Currency, or such shorter notice as may be acceptable to
such Issuing Bank and the Administrative Agent. Such
notice shall be irrevocable unless and until such request
is denied by the applicable Issuing Bank and shall
specify (A) that the requested Letter of Credit is either
a Commercial Letter of Credit or a Standby Letter of
Credit, (B) the stated amount of the Letter of Credit
requested, which shall be in a minimum amount of $10,000,
(C) the effective date (which shall be a Business Day) of
Issuance of such Letter of Credit, (D) the date on which
such Letter of Credit is to expire, (E) the Person for
whose benefit such Letter of Credit is to be Issued, (F)
whether such Letter of Credit is to be denominated in
Dollars or an Optional Currency (specifying the relevant
Optional Currency), and (G) other relevant terms of such
Letter of Credit. Such Issuing Bank shall notify the
Administrative Agent immediately upon receipt of a
written notice from any Borrower requesting that a Letter
of Credit be Issued and, upon the Administrative Agent's
request therefor, send a copy of such notice to the
Administrative Agent.
(ii) The Issuing Bank shall give the
Administrative Agent written notice, or telephonic notice
confirmed promptly thereafter in writing, of the Issuance
of a Letter of Credit (which notice the Administrative
Agent shall promptly transmit by telegram, telex,
telecopy or similar transmission to each Lender).
(d) Reimbursement Obligations; Duties of
Issuing Banks. (i) With the exception of the
reimbursement provisions contained in the Bond LC
Reimbursement Agreement, the terms of which will
supersede subsection 2.04(d)(i)(A), notwithstanding any
provisions to the contrary in any Letter of Credit
Reimbursement Agreement:
(A) each Borrower shall reimburse the
Issuing Bank for amounts drawn under any Letter
of Credit Issued for the account of such
Borrower pursuant to subsection (e)(ii) below,
in Dollars or the relevant Optional Currency,
no later than the date (the "Reimbursement
Date") that is one (1) Business Day after such
Borrower receives written notice from the
Issuing Bank that payment has been made under
such Letter of Credit by the Issuing Bank; and
(B) all Reimbursement Obligations with
respect to any Letter of Credit shall bear
interest at the rate applicable in accordance
with Section 4.01(a) from the date of the
relevant drawing under such Letter of Credit
until the Reimbursement Date and thereafter at
the rate applicable in accordance with Section
4.01(e).
(ii) The Issuing Bank shall give the
Administrative Agent written notice, or telephonic notice
confirmed promptly thereafter in writing, of all drawings
under a Letter of Credit and the payment (or the failure
to pay when due) by each Borrower on account of a
Reimbursement Obligation (which notice the Administrative
Agent shall promptly transmit by telegram, telex,
telecopy or similar transmission to each Lender).
(iii) No action taken or omitted in good faith
by an Issuing Bank under or in connection with any Letter
of Credit shall put such Issuing Bank under any resulting
liability to any Lender, any Borrower or, as long as such
Letter of Credit is not Issued in violation of Section
2.04(a), relieve any Lender of its obligations hereunder
to such Issuing Bank. Solely as between the Issuing
Banks and such Lenders, in determining whether to pay
under any Letter of Credit, the respective Issuing Bank
shall have no obligation to the Lenders other than to
confirm that any documents required to be delivered under
the respective Letter of Credit have been delivered and
that they appear on their face to comply with the
requirements of such Letter of Credit.
(e) Participations. (i) Immediately upon
Issuance by an Issuing Bank of any Letter of Credit for
the account of any Borrower in accordance with the
procedures set forth in this Section 2.04, each Lender
shall be deemed to have irrevocably and unconditionally
purchased and received from that Issuing Bank, without
recourse or warranty, an undivided interest and
participation in such Letter of Credit to the extent of
such Lender's Revolving Credit Pro Rata Share, including,
without limitation, all obligations of such Borrower with
respect thereto (other than amounts owing to the Issuing
Bank under Section 2.04(g)) and any security therefor and
guaranty pertaining thereto.
(ii) If any Issuing Bank makes any payment
under any Letter of Credit Issued for the account of any
Borrower and such Borrower does not repay such amount to
the Issuing Bank on the Reimbursement Date, the Issuing
Bank shall promptly notify the Administrative Agent,
which shall promptly notify each Lender, and each such
Lender shall promptly and unconditionally pay to the
Administrative Agent for the account of such Issuing
Bank, in immediately available funds, the amount of such
Lender's Revolving Credit Pro Rata Share of such payment
(net of that portion of such payment, if any, made by
such Lender in its capacity as an Issuing Bank), and the
Administrative Agent shall promptly pay to the Issuing
Bank such amounts received by it, and any other amounts
received by the Administrative Agent for the Issuing
Bank's account, pursuant to this Section 2.04(e). All
such payments shall constitute Revolving Loans made to
such Borrower pursuant to Section 2.01 (irrespective of
the satisfaction of the conditions in Section 5.02 or the
requirement in Section 2.01(b) to deliver a Notice of
Borrowing, which conditions and requirement, for the
purpose of refunding any Reimbursement Obligation owing
to any Issuing Bank, the Lenders irrevocably waive) and
shall thereupon cease to be unpaid Reimbursement
Obligations. If a Lender does not make its Revolving
Credit Pro Rata Share of the amount of such payment
available to the Administrative Agent, such Lender agrees
to pay to the Administrative Agent for the account of the
Issuing Bank, forthwith on demand, such amount together
with interest thereon, for the first Business Day after
the date such payment was first due at the Interbank
Rate. The failure of any such Lender to make available
to the Administrative Agent for the account of an Issuing
Bank its Revolving Credit Pro Rata Share of any such
payment shall neither relieve any other Lender of its
obligation hereunder to make available to the
Administrative Agent for the account of such Issuing Bank
such other Lender's Revolving Credit Pro Rata Share of
any payment on the date such payment is to be made nor
increase the obligation of any other Lender to make such
payment to the Administrative Agent nor prejudice any
rights that any Borrower may have against such Lender as
a result of any such default by such Lender. This
Section does not relieve any Lender of its obligation to
purchase Revolving Credit Pro Rata Share participations
in Letters of Credit, nor does this Section relieve any
Borrower of its obligation to pay or repay to any Issuing
Bank funding its Revolving Credit Pro Rata Share of such
payment pursuant to this Section interest on the amount
of such payment from the date such payment is to be made
until the date on which payment is repaid in full.
(iii) Whenever an Issuing Bank receives a
payment on account of a Reimbursement Obligation,
including any interest thereon, as to which any Lender
has made a Revolving Loan pursuant to clause (ii) of this
Section, such Issuing Bank shall promptly pay to the
Administrative Agent such payment in accordance with
Section 3.02. Whenever the Administrative Agent receives
(pursuant to the immediately preceding sentence or
otherwise) a payment on account of a Reimbursement
Obligation, including any interest thereon, as to which
any Lender has made a Revolving Loan pursuant to clause
(ii) of this Section, the Administrative Agent shall
distribute such payment in accordance with Section 3.02.
Each such payment shall be made by such Issuing Bank or
the Administrative Agent, as the case may be, on the
Business Day on which such Person receives the funds paid
to such Person pursuant to the preceding sentence, if
received prior to 11:00 a.m. (New York time) on such
Business Day, and otherwise on the next succeeding
Business Day.
(iv) Upon the request of any Lender, an Issuing
Bank shall furnish such Lender copies of any Letter of
Credit or Letter of Credit Reimbursement Agreement to
which such Issuing Bank is party and such other
documentation as reasonably may be requested by such
Lender.
(v) The obligations of a Lender to make
payments to the Administrative Agent for the account of
any Issuing Bank with respect to a Letter of Credit shall
be irrevocable, shall not be subject to any qualification
or exception whatsoever except willful misconduct or
gross negligence of such Issuing Bank as determined in a
final, non-appealable judgment by a court of competent
jurisdiction, and shall be honored in accordance with
this Article II (irrespective of the satisfaction of the
conditions described in Sections 5.01 and 5.02, as
applicable, which conditions, for the purpose of the
repayment of Letters of Credit to the Issuing Bank, such
Lenders irrevocably waive) under all circumstances,
including, without limitation, any of the following
circumstances:
(A) any lack of validity or
enforceability hereof or of any of the other
Loan Documents;
(B) the existence of any claim, setoff,
defense or other right that any Borrower may
have at any time against a beneficiary named in
a Letter of Credit or any transferee of a
beneficiary named in a Letter of Credit (or any
Person for whom any such transferee may be
acting), the Administrative Agent, the
Syndication Agent, any Issuing Bank, any Lender
or any other Person, whether in connection
herewith, or with any Letter of Credit, the
transactions contemplated herein or any
unrelated transactions (including any
underlying transactions between the account
party and beneficiary named in any Letter of
Credit);
(C) any draft, certificate or any other
document presented under the Letter of Credit
having been determined to be forged,
fraudulent, invalid or insufficient in any
respect or any statement therein being untrue
or inaccurate in any respect;
(D) the surrender or impairment of any
security for the performance or observance of
any of the terms of any of the Loan Documents;
(E) any failure by such Issuing Bank to
make any reports required pursuant to Section
2.04(h) or the inaccuracy of any such report;
or
(F) the occurrence of any Event of
Default or Default.
(f) Payment of Reimbursement Obligations. (i)
Each Borrower unconditionally agrees to pay to each
Issuing Bank, in the currency in which it is denominated,
the amount of all Reimbursement Obligations, interest and
other amounts payable to such Issuing Bank under or in
connection with any Letter of Credit Issued for the
account of such Borrower when such amounts are due and
payable, irrespective of any claim, setoff, defense or
other right that such Borrower may have at any time
against any Issuing Bank or any other Person.
(ii) In the event any payment by any Borrower
received by an Issuing Bank with respect to a Letter of
Credit Issued for the account of such Borrower and
distributed by the Administrative Agent to the Lenders on
account of their participation is thereafter set aside,
avoided or recovered from such Issuing Bank in connection
with any receivership, liquidation or bankruptcy
proceeding, each such Lender that received such
distribution shall, upon demand by such Issuing Bank,
contribute such Lender's Revolving Credit Pro Rata Share
of the amount set aside, avoided or recovered together
with interest at the rate required to be paid by such
Issuing Bank upon the amount required to be repaid by it.
(g) Issuing Bank Charges. Each Borrower shall
pay to each Issuing Bank, solely for its own account, the
standard charges assessed by such Issuing Bank in
connection with the issuance, administration, amendment
and payment or cancellation of any Letter of Credit and
such compensation in respect of such Letter of Credit for
such Borrower's account as may be agreed upon by such
Borrower and such Issuing Bank from time to time.
(h) Issuing Bank Reporting Requirements. Each
Issuing Bank shall, no later than the tenth Business Day
following the last day of each calendar month, provide to
the Administrative Agent and the Company separate
schedules for Commercial Letters of Credit and Standby
Letters of Credit Issued by it, in form and substance
reasonably satisfactory to the Administrative Agent,
setting forth the aggregate Letter of Credit Obligations
outstanding to it at the end of each month and any
information requested by the Administrative Agent or the
Company relating to the date of Issue, account party,
amount, expiration date and reference number of each
Letter of Credit Issued by it.
(i) Indemnification; Exoneration. (A) In
addition to all other amounts payable to an Issuing Bank,
each of the Borrowers hereby agrees to defend, indemnify
and save the Administrative Agent, the Syndication Agent,
each Issuing Bank and each Lender harmless from and
against any and all claims, demands, liabilities,
penalties, damages, losses (other than loss of profits),
reasonable costs, charges and expenses (including
reasonable attorneys' fees but excluding taxes) that the
Administrative Agent, the Syndication Agent, such Issuing
Bank or such Lender may incur or be subject to as a
consequence, direct or indirect, of (i) the Issuance of
any Letter of Credit to such Borrower other than as a
result of the gross negligence or willful misconduct of
the Issuing Bank, as determined in a final, non-
appealable judgment by a court of competent jurisdiction,
or (ii) the failure of the Issuing Bank Issuing a Letter
of Credit to such Borrower to honor a drawing under such
Letter of Credit as a result of any act or omission,
whether rightful or wrongful, of any present or future de
jure or de facto government or Governmental Authority.
(B) As between each Borrower, on the one hand,
and the Administrative Agent, the Syndication Agent, the
Lenders and the Issuing Banks, on the other hand, such
Borrower assumes all risks of the acts and omissions of,
or misuse of Letters of Credit issued on its behalf by,
the respective beneficiaries of the Letters of Credit.
In furtherance and not in limitation of the foregoing,
subject to the provisions of the Letter of Credit
Reimbursement Agreements, the Administrative Agent, the
Syndication Agent, the Issuing Banks and the Lenders
shall not be responsible for: (i) the form, validity,
legality, sufficiency, accuracy, genuineness or legal
effect of any document submitted by any party in
connection with the application for and Issuance of the
Letters of Credit, even if it should in fact prove to be
in any or all respects invalid, insufficient, inaccurate,
fraudulent or forged; (ii) the validity, legality or
sufficiency of any instrument transferring or assigning
or purporting to transfer or assign a Letter of Credit or
the rights or benefits thereunder or proceeds thereof, in
whole or in part, which may prove to be invalid or
ineffective for any reason; (iii) the failure of the
beneficiary of a Letter of Credit to comply duly with
conditions required in order to draw upon such Letter of
Credit; (iv) errors, omissions, interruptions or delays
in the transmission or delivery of any messages, by mail,
cable, telegraph, telecopy, telex or otherwise;
(v) errors in interpretation of technical terms; (vi) any
loss or delay in the transmission or otherwise of any
document required in order to make a drawing under any
Letter of Credit or of the proceeds thereof; (vii) the
misapplication by the beneficiary of a Letter of Credit
of the proceeds of any drawing under such Letter of
Credit; (viii) any litigation, proceeding or charges with
respect to such Letter of Credit; and (ix) any
consequential damages; and (x) any other consequences
arising from causes beyond the control of the
Administrative Agent, the Syndication Agent, the Issuing
Banks or the Lenders; except, in the cases of clauses
(iv), (v) and (viii) above, for the gross negligence or
willful misconduct of the Issuing Bank, as determined in
a final, non-appealable judgment by a court of competent
jurisdiction.
(j) Obligations Several. The obligations of
each Issuing Bank and each Lender under this Section 2.04
are several and not joint, and no Issuing Bank or Lender
shall be responsible for the obligation to Issue Letters
of Credit or participation obligation hereunder,
respectively, of any other Issuing Bank or Lender.
(k) Transitional Provisions. Schedule 2.04-K
contains a schedule of certain letters of credit issued
prior to the date hereof by the Issuing Banks for the
account of the Company. On the Closing Date, (i) such
letters of credit, to the extent outstanding, shall be
automatically and without further action by the parties
thereto converted to Letters of Credit issued pursuant to
this Section 2.04 for the account of the Company and
subject to the provisions hereof, and for this purpose
the fees specified in Sections 2.04(g) and 4.03(a) shall
be payable (in substitution for any fees set forth in the
reimbursement agreement relating to such letters of
credit) as if such letters of credit had been issued on
the Closing Date, (ii) the face amount of such letters of
credit shall be included in the calculation of Letter of
Credit Obligations, and (iii) all liabilities of the
Company with respect to such letters of credit shall
constitute Obligations. No letter of credit converted in
accordance with this Section 2.04(k) shall be amended,
extended or renewed without the prior written consent of
the Administrative Agent. To the extent that any fees
with respect to the letters of credit listed on Schedule
2.04-K were paid in advance to the issuing bank under
such letter of credit, the Administrative Agent shall use
reasonable efforts (but shall otherwise not be obligated)
to obtain a pro rata refund for the Company of such fees
to the extent such fees were paid in respect of any time
period during which such letter of credit shall be a
letter of credit on account of the provisions of this
section. Notwithstanding anything set forth in Section
2.04(a)(iii), to the extent that any letter of credit
listed on Schedule 2.04-K has an expiration date in
excess of one year, such letter(s) of credit shall
continue in full force and effect pursuant to the terms
hereof after the Closing Date.
2.05. Promise to Repay; Evidence of
Indebtedness.
(a) Promise to Repay. Each Borrower hereby
agrees to pay when due the principal amount of each Loan
that is made to it, and further agrees to pay when due
all unpaid interest accrued thereon, in accordance with
the terms hereof and of the Notes made by it. On the
Closing Date, (i) each of the Borrowers shall execute and
deliver to each Lender, as applicable, Revolving Credit
Notes substantially in the form of Exhibit F evidencing
the Revolving Loans, (ii) the Company shall execute and
deliver to the Swing Loan Bank a Swing Loan Note
substantially in the form of Exhibit G evidencing the
Swing Loans, and (iii) the Company shall execute and
deliver to the European Overdraft Bank a European
Overdraft Note substantially in the form of Exhibit K
evidencing the European Overdraft Loans, and thereafter,
each of the Borrowers, as applicable, shall execute and
deliver such other promissory notes as are necessary to
evidence the Loans owing to the Lenders after giving
effect to any assignment thereof pursuant to Section
13.01, all in form and substance reasonably acceptable to
the Administrative Agent and the parties to such
assignment (all such promissory notes and all amendments
thereto, replacements thereof and substitutions therefor
being collectively referred to as the "Notes"; and "Note"
means any one of the Notes).
(b) Loan Account. Each Lender shall maintain
in accordance with its usual practice an account or
accounts (a "Loan Account") evidencing the Indebtedness
of each Borrower to such Lender resulting from each Loan
made to such Borrower owing to such Lender from time to
time, including the amount of principal and interest
payable and paid to such Lender from time to time
hereunder and under each of the Notes.
2.06. Authorized Officers and Agents. On the
Closing Date (and from time to time thereafter at the
option of a Borrower or as reasonably requested by the
Administrative Agent), each of the Borrowers shall
deliver to the Administrative Agent an Officer's
Certificate setting forth the names of the officers,
directors or general managers, employees and agents
authorized to request Revolving Loans, Swing Loans,
European Overdraft Loans and Letters of Credit, and
containing a specimen signature of each such officer,
director, general manager, employee or agent. The
officers, directors or general managers, employees and
agents so authorized shall also be authorized to act for
each such Borrower in respect of all other matters
relating to the Loan Documents to which such Borrower is
a party. The Administrative Agent shall be entitled to
rely conclusively on such officer's, director's or
general manager's, or agent's or employee's authority to
request such Loan or Letter of Credit until the
Administrative Agent receives written notice to the
contrary. In addition, the Administrative Agent shall be
entitled to rely conclusively on any written notice sent
to it by any Borrower by telecopy. The Administrative
Agent shall have no duty to verify the authenticity of
the signature appearing on, or any telecopy or facsimile
of, any written Notice of Borrowing or any other
document. None of the Administrative Agent, the
Syndication Agent, any Lender or any Issuing Bank shall
incur any liability to any Borrower or any other Person
in acting upon any telecopy or facsimile notice referred
to above that the Administrative Agent reasonably
believes to have been given by a duly authorized officer
or other person authorized to borrow on behalf of any of
the Borrowers.
ARTICLE III
PAYMENTS AND PREPAYMENTS
3.01. Prepayments; Reductions in Revolving
Credit Commitments.
(a) Voluntary Prepayments/Reductions. Revolving
Credit Commitment. The Borrowers shall have the right, from
time to time, to terminate in whole or permanently reduce in
part the Revolving Credit Commitments (i) upon written notice
from the Company to the Administrative Agent delivered not
later than 11:00 a.m. (New York time) with respect to the
repayment of Base Rate Loans and (ii) upon at least three
(3) Business Days' prior written notice from the Company
to the Administrative Agent with respect to the repayment
of Eurocurrency Rate Loans; provided, that the Borrowers
shall have made whatever payment may be required to
reduce the Revolving Credit Obligations to an amount less
than or equal to the Revolving Credit Commitments after
giving effect to such reduction or termination of the
Revolving Credit Commitments. Any partial reduction of
the Revolving Credit Commitments shall be in an aggregate
minimum amount of $1,000,000 and integral multiples of
$1,000,000 in excess of that amount, and shall reduce the
Revolving Credit Commitment of each Lender
proportionately in accordance with its Revolving Credit
Pro Rata Share. Any notice of termination or reduction
given to the Administrative Agent under this
Section 3.01(a) shall specify the date (which shall be a
Business Day) of such termination or reduction and, with
respect to a partial reduction, the aggregate principal
amount thereof. When notice of termination or reduction
is delivered as provided herein, the principal amount of
the Revolving Loans specified in the notice shall become
due and payable on the date specified in such notice.
The payments in respect of reductions and terminations
described in this Section 3.01(a) may be made without
premium or penalty (except as provided in Section
4.02(f)).
(b) Mandatory Prepayments of Loans.
(i) (A) Subject to clause (C) below,
immediately after the Company's or any of the Domestic
Subsidiaries' receipt of any Net Cash Proceeds, the
Company shall make or cause to be made a mandatory
prepayment of the Revolving Loans in an amount equal to
one hundred percent (100%) of such Net Cash Proceeds. On
the date any mandatory prepayment is received by the
Administrative Agent pursuant to this clause (i), such
prepayment shall be applied first, to the outstanding
principal amount of the Swing Loans and second, to any
remaining non-contingent Revolving Credit Obligations
(with a corresponding reduction in the Revolving Credit
Commitments equal to 100% of such prepayment).
(B) Subject to clause (C) below, immediately
after the receipt by any Foreign Borrower of any Net Cash
Proceeds, such Foreign Borrower shall make or cause to be
made a mandatory prepayment of the Loans made to such
Foreign Borrower in an amount equal to one hundred
percent (100%) of such Net Cash Proceeds, or, if less, to
the balance of outstanding Loans made to such Foreign
Borrower. On the date any mandatory prepayment is
received by the Administrative Agent pursuant to this
clause (B), such prepayment shall be applied to any non-
contingent Revolving Credit Obligations of such Foreign
Borrower, and (i) the Revolving Credit Commitments shall
be reduced by an amount equal to 100% of such Net Cash
Proceeds and (ii) the sale of assets of any Foreign
Borrower resulting in a reduction in the Net Assets of
such Foreign Borrower by more than 50% but less than 90%
shall cause a reduction, by the percentage by which such
Foreign Borrower's Net Assets are reduced, in the
Revolving Credit Sublimit of such Foreign Borrower at
such time, and the sale of assets of any Foreign Borrower
resulting in a reduction in the Net Assets of such
Foreign Borrower by 90% or more shall reduce such Foreign
Borrower's Revolving Credit Sublimit to $0, unless, in
either case, as otherwise agreed by the Administrative
Agent and the Requisite Lenders.
(C) Notwithstanding the foregoing, (I) the
Company shall be entitled to use any Net Cash Proceeds
received in respect of the sale of the Company's Real
Property located in Graham, Texas to repay obligations
under the Existing IRDBs issued in connection with such
Real Property and (II) the Revolving Credit Commitments
will not be reduced by: (w) Net Cash Proceeds received
from the sale of the Properties described on Schedule
9.02, (x) any Net Cash Proceeds received after the
Closing Date in respect of the sale of the Company's Real
Property located in Graham, Texas, (y) indemnification
obligations owing to the Company pursuant to the terms of
the YIP Transaction arising from the failure of BCY
Industrial Enterprises to make required payments in
connection with the Existing IRDBs and (z) up to
$10,000,000 in any Fiscal Year of Net Cash Proceeds
arising from the sale of assets.
(ii) Subject to Section 4.02(e), if at any time
the Revolving Credit Obligations are greater than the
Revolving Credit Commitments, the Company shall, or shall
cause one or more of the Foreign Borrowers to, make
within one Business Day a mandatory repayment of the
Revolving Credit Obligations such that, after giving
effect thereto, the Revolving Credit Obligations do not
exceed the Revolving Credit Commitments.
(iii) Subject to Section 4.02(e), if at any time
the European Overdraft Obligations are greater than the
European Overdraft Commitments, the Foreign Borrowers
shall make, within one Business Day, a mandatory
repayment of the European Overdraft Obligations such
that, after giving effect thereto, the European Overdraft
Obligations do not exceed the European Overdraft
Commitments.
(iv) Nothing in this Section 3.01(b) shall be
construed to constitute the Lenders' consent to any
transaction that is not expressly permitted by
Article IX.
(v) All prepayments made pursuant to this
Section 3.01(b) shall be applied in accordance with
Section 3.02(b)(iii).
3.02. Payments. (a) Manner and Time of
Payment. All payments of principal of and interest on
the Loans and Reimbursement Obligations and other
Obligations (including, without limitation, fees and
reasonable expenses) that are payable to the
Administrative Agent, the Syndication Agent, the Lenders
or any Issuing Bank shall be made without condition or
reservation of right, in immediately available funds,
delivered to the Administrative Agent (or, in the case of
Reimbursement Obligations, to the pertinent Issuing Bank)
not later than 1:00 p.m. (New York time) (if made to the
U.S. Administrative Agent) or 1:00 p.m. (London time) (if
made to the European Administrative Agent) on the date
and at the place due, to the Administrative Agent's U.S.
Account or the applicable Administrative Agent's European
Account, as applicable (or, in the case of Reimbursement
Obligations, such account of the Issuing Bank as it may
designate, if applicable). Payments in respect of any
Swing Loans or European Overdraft Loans received by the
Administrative Agent shall be distributed to the Swing
Loan Bank or the European Overdraft Bank, as applicable,
and payments in respect of any Revolving Loan received by
the Administrative Agent shall be distributed by the
Administrative Agent to each Lender in accordance with
its Revolving Credit Pro Rata Share in accordance with
the provisions of Section 3.02(b) on the date received,
if received prior to 1:00 p.m. and (except in the case of
repayment of Swing Loans or European Overdraft Loans) on
the next succeeding Business Day if received thereafter.
(b) Apportionment of Payments. (i) Subject
to the provisions of Section 3.02(b)(iii) and (v), except
as otherwise provided herein, (A) all payments of
principal and interest in respect of outstanding
Revolving Loans made to any Borrower, and all payments in
respect of Reimbursement Obligations in respect of
Letters of Credit Issued for the account of such
Borrower, shall be allocated among such of the Lenders
and Issuing Banks as are entitled thereto in proportion
to their respective Revolving Credit Pro Rata Shares and
(B) all payments of fees and all other payments in
respect of any other Obligation of such Borrower (other
than European Overdraft Loans of such Borrower) shall be
allocated among such of the Lenders and Issuing Banks as
are entitled thereto, in proportion to their respective
Revolving Credit Pro Rata Shares. All such payments and
any other amounts received by the Administrative Agent
from or for the benefit of any Borrower shall be applied
first, to pay principal of and interest on any portion of
the Revolving Loans made to such Borrower which the
Administrative Agent may have advanced pursuant to the
express provisions of this Agreement on behalf of any
Lender other than the Lender then acting as
Administrative Agent, for which the Administrative Agent
has not then been reimbursed by such Lender or the
Borrowers, and second, to pay all other Obligations of
such Borrower (other than European Overdraft Loans of
such Borrower) then due and payable. Except as set forth
in Sections 3.01(a) and (b) and unless otherwise
designated by the Company, (A) all principal payments
made by a Borrower in respect of outstanding Revolving
Loans shall be applied first, to the outstanding Swing
Loans and second, to the outstanding Revolving Loans made
to such Borrower, and in the case of Revolving Loans,
first, to repay outstanding Base Rate Loans, and then to
repay outstanding Eurocurrency Rate Loans, with those
Loans that have earlier expiring Interest Periods being
repaid prior to those that have later expiring Interest
Periods and (B) subject to Section 2.01(d) all principal
payments made by any Foreign Borrower in respect of
outstanding Revolving Loans made to such Borrower shall
be applied first, to the outstanding Acquisition Loans,
if any, made to such Borrower, and second, subject to the
proviso in Section 4.02(e), to all other outstanding
Revolving Loans made to such Foreign Borrower, with those
Revolving Loans that have earlier expiring Interest
Periods being repaid prior to those that have later
expiring Interest Periods.
(ii) Subject to the provisions of Section
3.02(b)(iii), except as otherwise provided herein, all
payments of principal and interest, and fees and all
other payments, in respect of outstanding European
Overdraft Loans made to any Foreign Borrower, shall be
made to the European Overdraft Bank. All such payments
and any other amounts received by the European Overdraft
Bank from or on behalf of any Foreign Borrower shall be
applied first, to pay principal of and interest on any
portion of the European Overdraft Loans made to such
Foreign Borrower and second, to pay all other Obligations
of such Foreign Borrower then due and payable.
(iii) After the occurrence and during the
continuance of an Event of Default, the Administrative
Agent may, and shall upon the acceleration of the
Obligations pursuant to Section 11.02(a), apply all
payments made by the Company or any Foreign Borrower in
respect of any Obligations and all proceeds of Collateral
in the following order (it being understood that the
Administrative Agent shall have the right to convert at
the Borrowers' expense any of such payments or proceeds
of Collateral into the currency in which such Obligations
are denominated); provided, that payments made by a
Foreign Borrower shall be applied only to the Obligations
of such Foreign Borrower (including, without limitation,
the Obligations of such Foreign Borrower under its
Foreign Subsidiary Guaranty):
(A) first, to pay interest on and then
principal of any portion of the Loans that the
Administrative Agent may have advanced on
behalf of any Lender for which the
Administrative Agent has not then been
reimbursed by such Lender or the Borrowers;
(B) second, to pay interest on and then
principal of any Swing Loan;
(C) third, to pay Obligations in respect of
any expense reimbursements or indemnities then due
to the Administrative Agent, including, without
limitation, fees and expenses in respect of any cash
management services provided to the Company and its
Subsidiaries by the Administrative Agent;
(D) fourth, to pay Obligations in respect
of any expense reimbursements or indemnities
then due to the Syndication Agent, the Lenders
or the Issuing Banks;
(E) fifth, to pay Obligations in respect
of any fees then due to the Administrative
Agent, the Syndication Agent, the Lenders or
the Issuing Banks;
(F) sixth, to pay interest due in respect
of the Loans and Reimbursement Obligations on a
pro rata basis as among all such Loans and
Reimbursement Obligations;
(G) seventh, to pay or prepay principal
outstanding on the Loans and all outstanding Letter
of Credit Obligations on a pro rata basis as among
all such Loans and Reimbursement Obligations and, in
the case of such Revolving Loans, subject to Section
2.01(d), first, to pay principal of any Acquisition
Loan to such Borrower;
(H) eighth, to the ratable payment of Interest
Rate Contracts and Currency Agreements to which such
Borrower and the Administrative Agent or any
Affiliate of the Administrative Agent is a party;
and
(I) ninth, to the ratable payment of all other
Obligations;
provided, that if sufficient funds are not available to
fund all payments to be made in respect of any of the
Obligations described in any of the foregoing clauses (A)
through (I), the available funds being applied with
respect to any such Obligations referred to in any one of
such clauses (unless otherwise specified in such clause)
shall be allocated to the payment of such Obligations
ratably, based on the Aggregate Pro Rata Share of the
Administrative Agent, the Syndication Agent and each
Lender or Issuing Bank in the aggregate outstanding
Obligations described in such clause.
The order of priority set forth in this
Section 3.02(b)(iii) and the related provisions hereof
are set forth solely to determine the rights and
priorities of the Administrative Agent, the Syndication
Agent, the Lenders, the Issuing Banks and other Holders
as among themselves. The order of priority set forth in
clauses (A) through (I) of this Section 3.02(b)(iii) may
at any time and from time to time be changed by the
agreement of the Requisite Lenders without necessity of
notice to or consent of or approval by the Borrowers, any
Holder that is not a Lender or Issuing Bank, or any other
Person; provided, that the order of priority set forth in
clauses (A) through (E) of this Section 3.02(b)(iii) may
not be changed without the prior written consent of the
Administrative Agent.
(iv) The Administrative Agent, in its sole
discretion subject only to the terms of this Section
3.02(b)(iv), may pay from the proceeds of Revolving Loans
(which Loans have not been requested by any Borrower
pursuant to a Notice of Borrowing) made to the Company
hereunder, whether made following a request by the
Company pursuant to Section 2.01 or 2.02 or a deemed
request as provided in this Section 3.02(b)(iv), all
amounts then due and payable by the Borrowers hereunder,
including, without limitation, amounts payable with
respect to payments of principal, interest, Reimbursement
Obligations and fees and all reimbursements for
reasonable expenses pursuant to Section 13.02. The
Company hereby irrevocably authorizes the Swing Loan Bank
and the Lenders to make Revolving Loans, which Revolving
Loans shall be Base Rate Loans, in each case, upon notice
from the Administrative Agent as described in the
following sentence for the purpose of paying principal,
interest, Reimbursement Obligations and fees due from the
Borrowers, reimbursing expenses pursuant to Section 13.02
and paying any and all other amounts due and payable by
the Borrowers hereunder or under the Notes, and agrees
that all such Revolving Loans so made shall be deemed to
have been requested by it pursuant to Section 2.01 and
2.02 as of the date of the aforementioned notice. The
Administrative Agent shall request Revolving Loans on
behalf of the Company as described in the preceding
sentence by notifying the Lenders by telex, telecopy,
telegram or other similar form of transmission (which
notice the Administrative Agent shall thereafter promptly
transmit to the Company), of the amount and Funding Date
of the proposed Borrowing and that such Borrowing is
being requested on the Company's behalf pursuant to this
Section 3.02(b)(iv). On the proposed Funding Date, the
Lenders shall make the requested Loans in accordance with
the procedures and subject to the conditions specified in
Section 2.01 or 2.02 (irrespective of the satisfaction of
the conditions described in Section 5.02 or the
requirement to deliver a Notice of Borrowing in Section
2.01(b), which conditions and requirements, for the
purposes of the payment of Revolving Loans at the request
of the Administrative Agent as described in the preceding
sentence, the Lenders irrevocably waive).
(v) If any Lender fails to fund its Revolving
Credit Pro Rata Share of any Revolving Loan Borrowing
requested by any Borrower (or deemed requested pursuant
to Section 2.02, 2.03 or 3.02(b)(iv)) that such Lender is
obligated to fund under the terms hereof (the funded
portion of such Revolving Loan Borrowing being
hereinafter referred to as a "Non Pro Rata Loan"),
excluding any such Lender who has delivered to the
Administrative Agent written notice that one or more of
the conditions precedent contained in Section 5.02 shall
not on the date of such request be satisfied and until
such conditions are satisfied, then until the earlier of
such Lender's cure of such failure and the termination of
the Revolving Credit Commitments, the proceeds of all
amounts thereafter repaid to the Administrative Agent by
such Borrower and otherwise required to be applied to
such Lender's share of all other Obligations of such
Borrower pursuant to the terms hereof shall be advanced
to such Borrower by the Administrative Agent on behalf of
such Lender to cure, in full or in part, such failure by
such Lender, but shall nevertheless be deemed to have
been paid to such Lender in satisfaction of such other
Obligations. Notwithstanding anything contained herein
to the contrary:
(A) the foregoing provisions of this
Section 3.02(b)(v) shall apply only with
respect to the proceeds of payments of
Obligations of such Borrower;
(B) a Lender shall be deemed to have
cured its failure to fund its Revolving Credit
Pro Rata Share of any Revolving Loan made to
such Borrower at such time as an amount equal
to such Lender's original Revolving Credit Pro
Rata Share of the requested principal portion
of such Revolving Loan is fully funded to such
Borrower, whether made by such Lender itself or
by operation of the terms of this Section
3.02(b)(v), and whether or not the Non Pro Rata
Loan with respect thereto has been repaid;
(C) amounts advanced to such Borrower to
cure, in full or in part, any such Lender's
failure to fund its Revolving Credit Pro Rata
Share of any Revolving Loan Borrowing ("Cure
Loans") made to such Borrower shall bear
interest at the rate applicable to the other
Revolving Loans comprising such Borrowing and
shall be treated as Revolving Loans comprising
such Borrowing for all purposes herein;
(D) regardless of whether or not an Event of
Default has occurred or is continuing, and
notwithstanding the instructions of any Borrower as
to its desired application, all repayments of
principal which, in accordance with the other terms
of this Section 3.02, would be applied to the
outstanding Revolving Loans made to such Borrower
shall be applied first, ratably to all Revolving
Loans made to such Borrower constituting Non Pro
Rata Loans, second, ratably to Revolving Loans made
to such Borrower other than those constituting Non
Pro Rata Loans or Cure Loans and, third, ratably to
Revolving Loans made to such Borrower constituting
Cure Loans; and
(E) No Lender shall be relieved of any
obligation such Lender may have to such Borrower
under the terms of this Agreement as a result of the
provisions of this Section 3.02(b)(v).
(c) Payments on Non-Business Days. Whenever
any payment to be made by any Borrower hereunder or under
the Notes made by such Borrower is stated to be due on a
day that is not a Business Day, the payment shall instead
be due on the next succeeding Business Day (or, as set
forth in Section 4.02(a)(iii), the next preceding
Business Day), and any such extension of time shall be
included in the computation of the payment of interest
and fees hereunder.
(d) Payment Currency. Except as expressly set
forth herein to the contrary, all payments made by any
Borrower in respect of principal and interest on the
Loans and Reimbursement Obligations shall be made
(i) with respect to Loans and Reimbursement Obligations
denominated in Dollars, in Dollars, and (ii) with respect
to Multicurrency Loans or Reimbursement Obligations
denominated in an Optional Currency, in the Optional
Currency in which such Loan or the Letter of Credit
giving rise to such Reimbursement Obligation was made.
(e) Eurocurrency Loans. If a Eurocurrency
Loan is to be repaid on a date on which another
Eurocurrency Loan denominated in a different currency is
to be drawn down, any amount to be advanced by the
Lenders shall be applied by the Administrative Agent in
or towards purchasing, for the account of the relevant
Borrower, the sums to be repaid by the relevant Borrower
to the Administrative Agent on that day. The
Administrative Agent shall advise the relevant Borrower
of the net amount (if any) due from one to the other
under the provisions of this Section 3.02(e) after the
application of funds as aforesaid, and such net amount
shall accordingly forthwith be paid by the relevant
Borrower or the Administrative Agent on behalf of the
Lenders (as the case may be).
3.03. Taxes.
(a) Payment of Taxes. Any and all payments by
the Borrowers hereunder or under any Note or other
document evidencing any Obligations shall be made free
and clear of and without reduction for any and all
present and future taxes, levies, imposts, deductions,
charges, withholdings, and all stamp or documentary
taxes, excise taxes, ad valorem taxes and other taxes
imposed on the value of the Property, charges or levies
that arise from the execution, delivery or registration,
or from payment or performance under, or otherwise with
respect to, any of the Loan Documents or the Commitments
and all other liabilities with respect thereto excluding,
in the case of each Lender, each Issuing Bank, the
Syndication Agent and the Administrative Agent, taxes
imposed on its income, capital, profits or gains and
franchise taxes imposed on it by (i) the United States,
except certain withholding taxes contemplated pursuant to
Section 3.03(d)(iii)(C), (ii) the Governmental Authority
of a jurisdiction in which such Person has an office or
other fixed place of business, or any political
subdivision thereof (excluding any withholding or other
tax imposed on any payment made under the Loan
Documents), (iii) the Governmental Authority in which
such Person's Applicable Lending Office is located or in
which such Person is organized, managed and controlled or
any political subdivision thereof or (iv) any political
subdivision of the United States unless such taxes are
imposed solely as a result of such Lender's performance
of any of the Loan Documents (all such non-excluded
taxes, levies, imposts, deductions, charges, withholdings
and liabilities being hereinafter referred to as
"Taxes"). If any Borrower shall be required by law to
withhold or deduct any Taxes (other than Taxes imposed
solely as a result of any participation sold by a Lender
pursuant to Section 13.01(h)) from or in respect of any
sum payable hereunder or under any such Note or document
to any Lender, any Issuing Bank, the Syndication Agent or
the Administrative Agent, (x) the sum payable to such
Lender, such Issuing Bank or the Administrative Agent
shall be increased as may be necessary so that after
making all required withholding or deductions (including
withholding or deductions applicable to additional sums
payable under this Section 3.03) such Lender, such
Issuing Bank, the Syndication Agent or the Administrative
Agent (as the case may be) receives an amount equal to
the sum it would have received had no such withholding or
deductions been made, (y) such Borrower shall make such
withholding or deductions, and (z) such Borrower shall
pay the full amount withheld or deducted to the relevant
taxation authority or other authority in accordance with
applicable law.
(b) Indemnification. (i) Each Borrower will
indemnify each Lender, each Issuing Bank, the Syndication
Agent and the Administrative Agent against, and reimburse
each on demand for, the full amount of all Taxes
(including, without limitation, any Taxes imposed by any
Governmental Authority on amounts payable under this
Section 3.03 and any additional income or franchise taxes
resulting therefrom) incurred or paid in good faith by
such Lender, such Issuing Bank, the Syndication Agent or
the Administrative Agent (as the case may be) or any of
their respective Affiliates and any liability (including
penalties, interest and reasonable out-of-pocket expenses
paid to third parties) arising therefrom or with respect
thereto, whether or not such Taxes were lawfully payable,
in each case, with respect to such Borrower; provided,
that such Borrower shall not indemnify any such Lender,
Issuing Bank, Syndication Agent or Administrative Agent
for Taxes, penalties, additions to tax, interest and
expenses arising as a result of such Lender's, Issuing
Bank's, Syndication Agent's or Administrative Agent's
willful misconduct or gross negligence.
This indemnification shall be made within 15
days from the date such Lender, such Issuing Bank, the
Syndication Agent or the Administrative Agent (as the
case may be) makes written demand therefor, and within 15
days after the receipt of any refund of the Taxes
following final determination that the Taxes that gave
rise to the indemnification were not required to be paid,
such Lender, such Issuing Bank, the Syndication Agent or
the Administrative Agent (as the case may be) shall repay
such Borrower the amount of such paid indemnities.
A certificate as to any additional amount
payable to any Person under this Section 3.03 submitted
by it, with, to the extent readily available, either a
copy of any assessment thereof from the relevant taxing
authority (deleting any confidential information
contained therein) or proof of payment of a tax for which
such Borrower is liable hereunder, to the Company shall,
absent manifest error, be final, conclusive and binding
upon all parties hereto. Each Lender, the Syndication
Agent, the Administrative Agent and each Issuing Bank
agrees, within a reasonable time after receiving a
written request from the Company, to provide the
Borrowers and the Administrative Agent with such
certificates as are reasonably required and take such
other actions as are reasonably necessary to claim such
exemptions as such Lender, the Administrative Agent, the
Syndication Agent or such Issuing Bank or Affiliate may
be entitled to claim in respect of all or a portion of
any Taxes that are otherwise required to be paid or
deducted or withheld pursuant to this Section 3.03 in
respect of any payments under this Agreement or under the
Notes.
(ii) To the extent that the undertaking to
indemnify and reimburse the Administrative Agent, the
Syndication Agent, the Issuing Banks and the Lenders set
forth in this Section may be invalid and/or unenforceable
because it is violative of any law or public policy, such
Borrower shall contribute the maximum portion that it is
permitted to pay under applicable law to the payment of
the Taxes imposed on the Administrative Agent, the
Syndication Agent, the Issuing Banks and the Lenders.
(iii) If a Lender, Issuing Bank, the
Syndication Agent or the Administrative Agent shall
become aware that it is entitled to receive a refund
(including interest and penalties, if any) in respect of
Taxes as to which it has been indemnified by a Borrower
pursuant to this Section 3.03(b), it shall promptly
notify in writing such Borrower of the availability of
such refund (including interest and penalties, if any)
and shall, within 30 days after receipt of a request by
such Borrower, apply for such refund at such Borrower's
expense.
(c) Receipts. Within thirty (30) days after
the date of any payment of Taxes by the Company or any of
its Subsidiaries, the Company will furnish to the
Administrative Agent at its request, at its address
referred to in Section 13.08, the original or a certified
copy of a receipt, if any, or other documentation
reasonably satisfactory to the Administrative Agent,
evidencing payment thereof. The Company shall furnish to
the Administrative Agent upon the reasonable request of
the Administrative Agent from time to time an Officer's
Certificate stating that all Taxes of which it is aware
are due have been paid and that no additional Taxes of
which it is aware are due. The Administrative Agent may
demand payment of, and seek recourse on, any Taxes from
the Company and/or the Foreign Borrowers, to the extent
permitted by applicable law, without any requirement that
the Administrative Agent allocate the reimbursement
obligations for such Taxes among the Company and the
Foreign Borrowers.
(d) Foreign Bank Certifications. (i) Each of
the Issuing Banks and the Lenders represents and warrants
to the Administrative Agent and the Borrowers that under
applicable law and treaties in effect as of the date
hereof no withholding taxes imposed by the United States
or any country in which any Lender is organized or in
which any Lender's Applicable Lending Office is located,
managed, controlled or doing business, or any political
subdivision of any of the foregoing, will be required to
be withheld by the Company or the Foreign Borrowers with
respect to any payments to be made to such Lender or
Issuing Bank in respect of any of the Loans or the
Letters of Credit (it being understood that no Issuing
Bank or Lender makes any representation as to whether
withholding taxes imposed by any jurisdiction other than
the United States, a country in which any Lender's
Applicable Lending Office is located, managed, controlled
or doing business, or any political subdivision of any of
the foregoing, would be required to be withheld with
respect to payments to be made in respect of any of the
Loans or the Letters of Credit).
(ii) Each Lender or Issuing Bank that is not
created or organized under the laws of the United States
or a political subdivision thereof has delivered to the
Company and the Administrative Agent on the date on which
such Lender became a Lender or such Issuing Bank became
an Issuing Bank or shall deliver to the Company on the
date such Lender becomes a Lender or such Issuing Bank
becomes an Issuing Bank, if such date is after the
Closing Date, a true and accurate certificate executed in
duplicate by a duly authorized officer of such Lender or
Issuing Bank to the effect that such Lender or Issuing
Bank is eligible to receive payments hereunder, under the
Notes or under the Letters of Credit without deduction or
withholding of United States federal income tax (A) under
the provisions of an applicable tax treaty concluded by
the United States (in which case the certificate shall be
accompanied by two duly completed copies of IRS Form 1001
(or any successor or substitute form or forms)) or
(B) under Section 1441(c)(1) as modified for purposes of
Section 1442(a) of the Internal Revenue Code (in which
case the certificate shall be accompanied by two duly
completed copies of IRS Form 4224 (or any successor or
substitute form or forms)).
(iii) Each Lender and each Issuing Bank
further agrees to deliver to the Company and the
Administrative Agent from time to time a true and
accurate certificate executed in duplicate by a duly
authorized officer of such Lender or such Issuing Bank
before or promptly upon the occurrence of any event
requiring a change in the most recent certificate
previously delivered by it to the Company and the
Administrative Agent pursuant to this Section 3.03(d)
(including, but not limited to, a change in such Lender's
or such Issuing Bank's lending office). Each certificate
required to be delivered pursuant to this Section
3.03(d)(iii) shall certify as to one of the following:
(A) that such Lender or such Issuing Bank can
continue to receive payments hereunder and under the
Notes without deduction or withholding of United
States federal income tax;
(B) that such Lender or such Issuing Bank
cannot continue to receive payments hereunder and
under the Notes without deduction or withholding of
United States federal income tax as specified
therein but does not require additional payments
pursuant to Section 3.03(a) because it is entitled
to recover the full amount of any such deduction or
withholding from a source other than the Borrowers;
or
(C) that such Lender or Issuing Bank is no
longer capable of receiving payments hereunder and
under the Notes without deduction or withholding of
United States federal income tax as specified
therein by reason of a change in law (including the
Internal Revenue Code or applicable tax treaty)
after the later of the Closing Date or the date on
which such Lender became a Lender or such Issuing
Bank became an Issuing Bank and that it is not
capable of recovering the full amount of the same
from a source other than the Borrowers.
Each Lender and each Issuing Bank agrees to deliver to
the Company and the Administrative Agent further duly
completed copies of the above-mentioned IRS forms on or
before the earlier of (x) the date that any such form
expires or becomes obsolete or otherwise is required to
be resubmitted as a condition to obtaining an exemption
from withholding from United States federal income tax
and (y) fifteen (15) days after the occurrence of any
event requiring a change in the most recent form
previously delivered by such Lender or such Issuing Bank
to the Company and the Administrative Agent, unless any
change in treaty, law, regulation or official
interpretation thereof that would render such form
inapplicable or that would prevent the Lender from duly
completing and delivering such form has occurred prior to
the date on which any such delivery would otherwise be
required, and the Lender or the Issuing Bank promptly
advises the Company that it is not capable of receiving
payments hereunder or under the Notes without any
deduction or withholding of United States federal income
tax.
Notwithstanding any provision of paragraphs (a)
and (b) above to the contrary, the Borrowers shall not
have any obligation to pay any Taxes or to indemnify any
Lender or Issuing Bank for any Taxes to the extent that
such Taxes result from (x) the failure of any Lender or
Issuing Bank to comply with its obligations pursuant to
this paragraph (d), or (y) any representation made on
Form 1001 or 4224 or successor applicable form or
certification by the Lender or Issuing Bank incurring
such Taxes proving to have been incorrect, false or
misleading in any material respect when so made or deemed
to be made.
(e) Any of the Lenders, Issuing Banks, the
Syndication Agent, or the Administrative Agent claiming
any additional amounts payable pursuant to this Section
3.03 shall use reasonable efforts (consistent with legal
and regulatory restrictions) to avoid the need for, or
reduce the amount of, any such additional amounts that
may thereafter accrue, provided that such efforts would
not, in the sole determination of such Lender, Issuing
Bank, Syndication Agent or Administrative Agent, as the
case may be, be otherwise disadvantageous to such Lender,
Issuing Bank, Syndication Agent or Administrative Agent.
(f) In the event that any Lender changes its
Applicable Lending Office, such Lender shall not be
entitled to receive any greater payment under this
Section 3.03 than such Lender would have been entitled to
receive had such change not occurred, unless such change
in Applicable Lending Office shall have been made at the
request of a Borrower or at a time when no payment under
this Section 3.03 was required.
3.04. Increased Capital. If after the date
hereof any Lender or Issuing Bank determines that (i) the
adoption or implementation of or any change in or in the
interpretation or administration of any law or regulation
or any guideline or request from any central bank or
other Governmental Authority or quasi-governmental
authority exercising jurisdiction, power or control over
any Lender, Issuing Bank or banks or financial
institutions generally (whether or not having the force
of law), compliance with which affects or would affect
the amount of capital required or expected to be
maintained by such Lender or Issuing Bank or any
corporation controlling such Lender or Issuing Bank and
(ii) the amount of such capital is increased by or based
upon (A) the making or maintenance by any Lender of its
Loans, any Lender's participation in or obligation to
participate in the Loans, Letters of Credit or other
advances made hereunder or the existence of any Lender's
obligation to make Loans or (B) the issuance or
maintenance by any Issuing Bank of, or the existence of
any Issuing Bank's obligation to Issue, Letters of
Credit, then, in any such case, upon written demand by
such Lender or Issuing Bank (with a copy of such demand
to the Administrative Agent), the Borrowers shall
immediately pay to the Administrative Agent for the
account of such Lender or Issuing Bank, from time to time
as specified by such Lender or Issuing Bank, additional
amounts sufficient to compensate such Lender or Issuing
Bank or such corporation therefor. Such demand shall be
accompanied by a statement as to the amount of such
compensation and include a summary of the basis for such
demand with detailed calculations. Such statement shall
be conclusive and binding for all purposes, absent
manifest error.
ARTICLE IV
INTEREST AND FEES
4.01. Interest on the Loans and Other
Obligations. (a) Rate of Interest. All Loans and the
outstanding principal balance of all other Obligations
shall bear interest on the unpaid principal amount
thereof from the date such Loans are made and such other
Obligations are due and payable until paid in full,
except as otherwise provided in Section 4.01(d), as
follows:
(i) If a Base Rate Loan or such other
Obligation, at a rate per annum equal to the
sum of (A) the Base Rate from time to time
applicable to the currency in which such
Obligation is denominated, plus (B) the Base
Rate Margin;
(ii) If a Eurocurrency Rate Loan, at a
rate per annum equal to the sum of (A) the
Eurocurrency Rate determined for the applicable
Interest Period and the applicable currency in
effect during such Interest Period, plus (B)
the Eurocurrency Rate Margin.
The applicable basis for determining the rate of interest
on the Loans shall be selected by the applicable Borrower
at the time a Notice of Borrowing or a Notice of
Conversion/Continuation is delivered by such Borrower to
the Administrative Agent; provided, that no Borrower may
select the Eurocurrency Rate as the applicable basis for
determining the rate of interest on a Loan if (x) such
Loan is to be made on the Closing Date or (y) at the time
of such selection an Event of Default or Default would
occur or has occurred and is continuing. If on any day
any Loan is outstanding with respect to which notice has
not been timely delivered to the Administrative Agent in
accordance with the terms hereof specifying the basis for
determining the rate of interest on that day, then for
that day interest on that Loan shall be determined by
reference to the applicable Base Rate.
(b) Interest Payments. (i) Interest accrued
on each (A) Base Rate Loan (other than Swing Loans and
European Overdraft Loans) shall be payable to the
Administrative Agent for the account of the Lenders
(x) quarterly in arrears on the first Business Day of
each January, April, July and October, commencing on the
first such day following the making of such Base Rate
Loan and (y) if not theretofore paid in full, at maturity
(whether by acceleration or otherwise) of such Base Rate
Loan; (B) interest accrued on Swing Loans shall be
payable to the Swing Loan Bank for its own account
quarterly in arrears on the first Business Day of each
January, April, July and October, commencing on the first
such day following the making of such Swing Loan; and (C)
interest accrued on European Overdraft Loans shall be
payable to the European Overdraft Bank for its own
account quarterly in arrears on the first Business Day of
each January, April, July and October, commencing on the
first such day following the making of such European
Overdraft Loan.
(ii) Interest accrued on each Eurocurrency Rate
Loan shall be payable in arrears in the currency in which
such Loan is denominated (A) on each Eurocurrency
Interest Payment Date and (B) if not theretofore paid in
full, at maturity (whether by acceleration or otherwise)
of such Eurocurrency Rate Loan.
(iii) Interest accrued on the principal balance
of all other Obligations shall be payable in the currency
in which such Obligation is denominated (A) quarterly in
arrears on the first Business Day of each January, April,
July and October, commencing on the first such day
following the incurrence of such Obligation and (B) if
not theretofore paid in full, at the time such other
Obligation becomes due and payable (whether by
acceleration or otherwise).
(c) Conversion or Continuation; Redenomination
of Loans. (i) The Borrowers shall have the option (A) to
convert at any time all or any part of outstanding Base
Rate Loans (other than Swing Loans or European Overdraft
Loans) to Eurocurrency Rate Loans; (B) to convert all or
any part of outstanding Eurocurrency Rate Loans having
Interest Periods that expire on the same date to Base
Rate Loans on such expiration date; or (C) to continue
all or any part of outstanding Eurocurrency Rate Loans
having Interest Periods that expire on the same date as
Eurocurrency Rate Loans, and the succeeding Interest
Period of such continued Loans shall commence on such
expiration date; provided, that no such outstanding Loan
may be continued as, or be converted into, a Eurocurrency
Rate Loan, (i) if such continuation or conversion would
violate any of the provisions of Section 4.02 or (ii) if
an Event of Default or Default would occur as a result
thereof or has occurred and is continuing. Any
conversion into or continuation of Eurocurrency Rate
Loans under this Section 4.01(c) shall be in a minimum
amount of $1,000,000 and in integral multiples of
$1,000,000 in excess of that amount.
(ii) To convert or continue a Loan under
Section 4.01(c)(i), the Company or the Borrower shall
deliver a Notice of Conversion/Continuation to the
Administrative Agent no later than 11:00 a.m. (New York
time) (if delivered to the U.S. Administrative Agent) and
11:00 a.m. (London time) (if delivered to the European
Administrative Agent) at least three (3) Business Days in
advance of the proposed conversion/continuation date. A
Notice of Conversion/Continuation shall specify (A) the
proposed date of the conversion or continuation, as
applicable (which shall be a Business Day), (B) the
principal amount of the Loan to be converted or
continued, (C) whether such Loan shall be converted or
continued and (D) in the case of a conversion to, or
continuation of, a Eurocurrency Rate Loan, the requested
Interest Period. Promptly after receipt of a Notice of
Conversion/Continuation under this Section 4.01(c)(ii),
the Administrative Agent shall notify each Lender by
telex or telecopy, or other similar form of transmission,
of the proposed conversion or continuation. Any Notice
of Conversion/Continuation for conversion to, or
continuation of, a Loan shall be irrevocable, and the
Borrowers shall be bound to convert or continue in
accordance therewith.
(d) Default Interest. Notwithstanding the
rates of interest specified in Section 4.01(a) or
elsewhere herein, effective immediately upon the
occurrence of any Event of Default set forth in Section
11.01(a) and for as long thereafter as such Event of
Default shall be continuing, the principal balance of all
Loans, to the extent permitted by applicable law, and of
all other Obligations shall bear interest at a rate that
is two percent (2.0%) per annum in excess of the rate of
interest that would otherwise be applicable to such Loans
and Obligations from time to time.
(e) Computation of Interest. Interest on all
Eurocurrency Rate Loans and, to the extent permitted by
applicable law, all other Obligations except for Base
Rate Loans shall be computed on the basis of the actual
number of days elapsed in the period during which
interest accrues and a year of 360 days; provided, that
interest on all Eurocurrency Rate Loans denominated in
Belgian francs or British pound sterling ("Euro
sterling") shall be computed on the basis of the actual
number of days elapsed in the period during which
interest accrues and a year of 365 or 366 days, as the
case may be. Interest on all Base Rate Loans shall be
computed on the basis of a year of 365 or 366 days, as
the case may be. In computing interest on any Loan, the
date of the making of the Loan shall be included and the
date of payment shall be excluded.
(f) Changes; Legal Restrictions. If after the
date hereof any Lender or Issuing Bank determines that
the adoption or implementation of or any change in or in
the interpretation or administration of any law or
regulation or any guideline or request from any central
bank or other Governmental Authority or quasi-
governmental authority exercising jurisdiction, power or
control over any Lender, Issuing Bank or over banks or
financial institutions generally (whether or not having
the force of law), compliance with which, in each case
after the date hereof:
(i) subjects a Lender or an Issuing Bank
(or its Applicable Lending Office) to charges
(other than Taxes) of any kind that are
applicable to the Revolving Credit Commitments
of the Lenders and/or the Issuing Banks to make
Eurocurrency Rate Loans or to Issue and/or
participate in Letters of Credit; or
(ii) imposes, modifies or holds applicable
any reserve (other than reserves taken into
account in calculating the Eurocurrency Rate),
special deposit, compulsory loan, FDIC
insurance or similar requirement against assets
held by, or deposits or other liabilities
(including those pertaining to Letters of
Credit) in or for the account of, advances or
loans by, commitments made, or other credit
extended by, or any other acquisition of funds
by, a Lender or an Issuing Bank or any
Applicable Lending Office or Eurocurrency
Affiliate of that Lender or Issuing Bank;
and the result of any of the foregoing is to increase the
cost to that Lender or Issuing Bank of making, renewing
or maintaining the Loans or its Revolving Credit
Commitments or issuing or participating in the Letters of
Credit or to reduce any amount receivable thereunder;
then, in any such case, upon written demand by such
Lender or Issuing Bank (with a copy of such demand to the
Administrative Agent), the Borrowers shall immediately
pay to the Administrative Agent for the account of such
Lender or Issuing Bank, from time to time as specified by
such Lender or Issuing Bank, such amount or amounts as
may be necessary to compensate such Lender or Issuing
Bank or its Eurocurrency Affiliate for any such
additional cost incurred or reduced amount received.
Such written demand shall be accompanied by a statement
as to the amount of such compensation and demonstrate in
reasonable detail the calculation of such amount and a
summary of the basis for such demand. Such statement
shall be conclusive and binding for all purposes, absent
manifest error.
(g) Confirmation of Eurocurrency Rate. Upon
the reasonable request of any of the Borrowers from time
to time, the Administrative Agent shall promptly provide
to the Borrowers such information with respect to the
applicable Eurocurrency Rate as may be so requested.
(h) Overall Interest Rate for French Law.
Given the variable rates of interest applicable to the
Loans, the overall interest rate ("taux effectif
global"), as French Usury Law of December 28, 1996 and
the decree of September 4, 1985, cannot be calculated.
4.02. Special Provisions Governing
Eurocurrency Rate Loans. With respect to Eurocurrency
Rate Loans:
(a) Determination of Interest Period. By
giving notice as set forth in Section 2.01(b) (with
respect to a Borrowing of a Eurocurrency Rate Loan) or
Section 4.01(c) (with respect to a conversion into or
continuation of a Eurocurrency Rate Loan), each Borrower
shall have the option, subject to the other provisions of
this Section 4.02, to select an interest period (each, an
"Interest Period") to apply to the Loans described in
such notice, subject to the following provisions:
(i) Each Borrower may only select, as to
a particular Borrowing of Eurocurrency Rate
Loans, an Interest Period of either one, two,
three or six months in duration or, with the
consent of the Lenders, seven days, or nine or
twelve months in duration;
(ii) In the case of immediately successive
Interest Periods applicable to a Borrowing of
Eurocurrency Rate Loans, each successive
Interest Period shall commence on the day on
which the next preceding Interest Period
expires;
(iii) If any Interest Period would
otherwise expire on a day that is not a
Business Day, such Interest Period shall be
extended to expire on the next succeeding
Business Day if the next succeeding Business
Day occurs in the same calendar month, and if
there shall be no succeeding Business Day in
such calendar month, such Interest Period shall
expire on the immediately preceding Business
Day;
(iv) No Borrower may select an Interest
Period as to any Loan if such Interest Period
terminates later than the Revolving Credit
Termination Date; and
(v) There shall be no more than ten (10)
Borrowings of Eurocurrency Loans by the Company
and ten (10) Borrowings by the Foreign
Borrowers (in the aggregate) in effect at any
one time.
(b) Determination of Interest Rate. As soon
as practicable on the second Business Day prior to the
first day of each Interest Period (the "Interest Rate
Determination Date"), the Administrative Agent shall
determine (pursuant to the procedures set forth in the
definition of "Eurocurrency Rate") the interest rate that
shall apply to Eurocurrency Rate Loans to be made in
Dollars or any Optional Currency, as applicable, for
which an interest rate is then being determined for the
applicable Interest Period and currency, and shall
promptly give notice thereof (in writing or by telephone
confirmed in writing) to the Borrowers and to each
Lender. Each Reference Bank agrees to furnish to the
Administrative Agent timely information for the purpose
of determining the Eurocurrency Rate. If any one or more
of the Reference Banks shall not furnish such information
to the Administrative Agent, the Administrative Agent
shall determine such interest rate on the basis of timely
information furnished by the remaining Reference Banks.
The Administrative Agent's determination shall be
presumed to be correct, absent manifest error, and shall
be binding upon the Borrowers and the Lenders.
(c) Interest Rate Unascertainable, Inadequate
or Unfair. In the event that at least one (1) Business
Day before the Interest Rate Determination Date:
(i) the Administrative Agent determines
that adequate and fair means do not exist for
ascertaining the applicable interest rates by
reference to which the Eurocurrency Rate then
being determined is to be fixed;
(ii) any Lender advises the Administrative
Agent that deposits in Dollars or the
applicable Optional Currency, as applicable, in
the principal amounts of the Eurocurrency Rate
Loans comprising such Borrowing are not
generally available in the London interbank
market for a period equal to such Interest
Period; or
(iii) any Lender advises the Administrative
Agent that the Eurocurrency Rate, as determined by
the Administrative Agent, after taking into account
the adjustments for reserves and increased costs
provided for in Section 4.01(f), will not adequately
and fairly reflect the cost to the Lenders of
funding their Eurocurrency Rate Loans in the
currency in which such Loans are denominated;
then the Administrative Agent shall forthwith give notice
thereof to the Company, whereupon (until the
Administrative Agent notifies the Company that the
circumstances giving rise to such suspension no longer
exist) the right of the Borrowers to elect to have Loans
bear interest based upon the Eurocurrency Rate in such
currency shall be suspended and each outstanding
Eurocurrency Rate Loan that is denominated in the
affected currency shall be converted into a Base Rate
Loan denominated in such currency on the last day of the
then current Interest Period therefor, and any Notice of
Borrowing with respect to Loans denominated in such
currency for which Revolving Loans have not then been
made shall be deemed to be a request for Base Rate Loans
in such currency, notwithstanding any prior election by
any Borrower to the contrary.
(d) Illegality. (i) If at any time any
Lender determines (which determination shall, absent
manifest error, be final and conclusive and binding upon
all parties) that the making or continuation of any
Eurocurrency Rate Loan in any currency has become
unlawful or impermissible by compliance by that Lender
with any law, governmental rule, regulation or order of
any Governmental Authority (whether or not having the
force of law and whether or not failure to comply
therewith would be unlawful or would result in costs or
penalties), then, and in any such event, such Lender may
give notice of that determination, in writing, to the
Company and the Administrative Agent, and the
Administrative Agent shall promptly transmit the notice
to each other Lender.
(ii) When notice is given by a Lender under
Section 4.02(d)(i), (A) the Borrowers' right to request
from such Lender and such Lender's obligation, if any, to
make Eurocurrency Rate Loans in such currency shall be
immediately suspended, and such Lender shall make a Base
Rate Loan as part of any requested Borrowing of
Eurocurrency Rate Loans in such currency and (B) if the
affected Eurocurrency Rate Loan or Loans are then
outstanding, the Borrowers shall immediately, or if
permitted by applicable law, no later than the date
permitted thereby, upon at least one (1) Business Day's
prior written notice to the Administrative Agent and the
affected Lender, convert each such Loan into a Base Rate
Loan.
(iii) If at any time after a Lender gives notice
under Section 4.02(d)(i) in respect of a Eurocurrency
Rate Loan in any currency such Lender determines that it
may lawfully make Eurocurrency Rate Loans in such
currency, such Lender shall promptly give notice of that
determination, in writing, to the Company and the
Administrative Agent, and the Administrative Agent shall
promptly transmit the notice to each other Lender. The
Borrowers' right to request, and such Lender's
obligation, if any, to make Eurocurrency Rate Loans shall
thereupon be restored.
(e) Compensation. In addition to all amounts
required to be paid by the Borrowers pursuant to
Section 4.01, each Borrower agrees to compensate each
Lender, upon written demand therefor to such Borrower,
with a copy to the Administrative Agent, for all losses,
expenses and liabilities (including, without limitation,
any loss or reasonable expense incurred by reason of the
liquidation or reemployment of deposits or other funds
acquired by such Lender to fund or maintain such Lender's
Eurocurrency Rate Loans made to such Borrower but
excluding any loss of the Eurocurrency Rate Margin on the
relevant Loans) that Lender may sustain (i) if for any
reason (other than a default by such Lender) a Borrowing
of, conversion into or continuation of such Eurocurrency
Rate Loans does not occur on a date specified therefor in
a Notice of Borrowing or a Notice of Conversion/Continuation
given by such Borrower, or a successive Interest Period does
not commence after notice therefor is given pursuant to Section
4.01(c), including, without limitation, pursuant to Section
4.02(c), (ii) if for any reason any Eurocurrency Rate Loan made
to such Borrower is prepaid (including, without limitation,
mandatorily pursuant to Section 3.01(b)) on a date that
is not the last day of the applicable Interest Period,
(iii) as a consequence of a required conversion of such
Eurocurrency Rate Loan to a Base Rate Loan as a result of
any of the events indicated in Section 4.02(c) or (d) or
(iv) as a consequence of any failure by the Borrowers to
repay Eurocurrency Rate Loans when required by the terms
hereof. The Lender making demand for such compensation
shall deliver to the applicable Borrower concurrently
with such demand a written statement in reasonable detail
as to such losses, reasonable expenses and liabilities,
and this statement shall be conclusive as to the amount
of compensation due to that Lender, absent manifest
error.
(f) Booking of Eurocurrency Rate Loans. Any
Lender may make, carry or transfer Eurocurrency Rate
Loans at, to, or for the account of its European Lending
Office or Eurocurrency Affiliate or its other offices or
Affiliates. No Lender shall be entitled, however, to
receive any greater amount under Sections 3.03, 3.04,
4.01(f) or 4.02(e) as a result of the transfer of any
such Eurocurrency Rate Loan to any office (other than
such European Lending Office) or any Affiliate (other
than such Eurocurrency Affiliate) than such Lender would
have been entitled to receive immediately prior thereto,
unless (i) the transfer occurred at a time when
circumstances giving rise to the claim for such greater
amount did not exist and (ii) such claim would have
arisen even if such transfer had not occurred.
(g) Affiliates Not Obligated. No Eurocurrency
Affiliate or other Affiliate of any Lender shall be
deemed a party to this Agreement or shall have any
liability or obligation hereunder.
4.03. Fees. (a) Letter of Credit Fee. In
addition to any charges paid pursuant to Section 2.04(g),
each Borrower shall pay to the Administrative Agent, for
the account of the Lenders as provided in the following
sentence, (i) with respect to any Commercial Letter of
Credit Issued by any Issuing Bank for the account of such
Borrower, a fee per annum equal to fifty percent (50%) of
the Eurocurrency Rate Margin as of the date of each such
payment on the undrawn face amount of such Commercial
Letter of Credit and (ii) with respect to any Standby
Letter of Credit Issued by any Issuing Bank for the
account of such Borrower, a fee per annum equal to the
Eurocurrency Rate Margin as of the date of each such
payment on the undrawn face amount of such Standby Letter
of Credit (the fees referred to in clauses (i) and (ii)
above are collectively referred to herein as the "Letter
of Credit Fee"), in each case payable in arrears on the
first day of each fiscal quarter for the preceding fiscal
quarter and on the date on which such Letter of Credit
expires in accordance with its terms; provided, that,
effective immediately upon the occurrence of any Event of
Default set forth in Section 11.01(a) and for as long
thereafter as such Event of Default shall be continuing,
the rate at which the Letter of Credit Fee shall accrue
and be payable shall be equal to two percent (2.0%) per
annum in excess of the fee that would otherwise be
applicable to such Letter of Credit from time to time.
The Administrative Agent shall pay each Letter of Credit
Fee to the Lenders in accordance with their respective
Revolving Credit Pro Rata Shares.
(b) Unused Commitment Fee. The Borrowers
shall pay to the Administrative Agent, for the account of
the Lenders in accordance with their respective Revolving
Credit Pro Rata Shares, a fee (the "Revolving Credit
Unused Commitment Fee") accruing from the Closing Date at
the Unused Commitment Fee Rate on the average amount by
which the Revolving Credit Commitments exceed the
Revolving Credit Obligations for the period commencing on
the Closing Date and ending on the Revolving Credit
Termination Date, the accrued portion of such fee being
payable (A) quarterly, in arrears, on the first day of
the immediately succeeding quarter, commencing on the
first such day after the Closing Date and (B) on the
Revolving Credit Termination Date (whether or not such
date occurs on, before or after the Closing Date). The
Borrowers shall pay to the European Overdraft Bank a fee
accruing from the Closing Date at the Unused Commitment
Fee Rate on the average amount by which the European
Overdraft Commitment exceeds the European Overdraft
Obligations for the period commencing on the Closing Date
and ending on the Revolving Credit Termination Date, the
accrued portion of such fee being payable (A) quarterly,
in arrears, on the first day of the immediately
succeeding quarter, commencing on the first such day
after the Closing Date and (B) on the Revolving Credit
Termination Date (whether or not such date occurs on,
before or after the Closing Date). Notwithstanding the
foregoing, in the event that any Lender fails to fund its
Revolving Credit Pro Rata Share of any Revolving Loan
requested by any Borrower which such Lender is obligated
to fund under the terms hereof, such Lender shall not be
entitled to any Unused Commitment Fee with respect to its
Revolving Credit Commitment until such failure has been
cured in accordance with Section 3.02(b)(v)(B), and the
Borrowers shall not be required to pay any Revolving
Credit Unused Commitment Fee to such Lender for such
period.
(c) Closing Date Unused Commitment Fee. In
the event that the Closing Date does not occur by January
26, 1996, the Borrowers shall pay on the Closing Date to
each Lender a fee accruing from January 26, 1996 at the
Unused Commitment Fee Rate on each such Lender's
Commitment as of and for the period commencing on January
26, 1996 and ending on the Closing Date; provided, that
with respect to a Foreign Borrower, such Foreign
Borrower's obligation to pay such fee shall be limited to
a pro rata share of the aggregate amount of such fee,
determined by reference to such Foreign Borrower's
Revolving Credit Sublimit at such time.
(d) Closing Fee. On the Closing Date, the
Borrowers shall pay to each Lender a fee equal to one-
eighth of one percent (0.125%) of each such Lender's
Commitment.
(e) Other Fees. The Borrowers shall pay (i)
to the Administrative Agent solely for its own account
such other fees as are set forth in the Citibank Letter
Agreement and (ii) to the Syndication Agent solely for
its own account such other fees as are set forth in the
Credit Suisse Letter Agreement.
(f) Calculation and Payment of Fees. All of
the above fees shall be calculated on the basis of the
actual number of days elapsed in a 360 day year. All
such fees shall be payable in addition to, and not in
lieu of, interest, expense reimbursements,
indemnification and other Obligations. Fees shall be
payable to the Administrative Agent's U.S. Account in
accordance with Section 3.02. All fees shall be fully
earned and nonrefundable when paid. All fees specified
or referred to herein due to the Administrative Agent,
the Syndication Agent, any Issuing Bank or any Lender,
including, without limitation, those referred to in this
Section 4.03, shall bear interest, if not paid when due,
at the interest rate for Loans in accordance with
Section 4.01(d), shall constitute Obligations and shall
be secured by the Collateral.
ARTICLE V
CONDITIONS TO LOANS AND LETTERS OF CREDIT
5.01. Conditions Precedent to the Initial
Loans and Letters of Credit. The obligation of each
Lender on the Closing Date to make its Revolving Loan
requested to be made by it and the agreement of each
Issuing Bank on the Closing Date to Issue Letters of
Credit, shall be subject to the satisfaction of all of
the following conditions precedent:
(a) Documents. The U.S. Administrative Agent
(on behalf of itself and the Lenders) shall have received
on or before the Closing Date all of the following:
(i) this Agreement, the Notes, the
Company Pledge Agreement, the Foreign Pledge
Agreements, the Company Guaranty, the Domestic
Subsidiary Guaranty, the Foreign Subsidiary
Guaranties and all other agreements, documents
and instruments described in the List of
Closing Documents attached hereto and made a
part hereof as Exhibit D, each duly executed
where appropriate and in form and substance
satisfactory to the Lenders and in sufficient
copies for each of the Lenders; without
limiting the foregoing, the Company hereby
directs (A) each of its special counsel,
(x) Skadden, Arps, Slate, Meagher & Flom, (y)
Kronish, Lieb, Weiner & Hellman, and
(z) Wendel, Rosen, Black & Dean and (B) each of
the foreign counsel to the Borrowers listed in
such List of Closing Documents to prepare and
deliver to the Administrative Agent, the
Syndication Agent, the Lenders and the Issuing
Banks, the opinions referred to in such List of
Closing Documents with respect to each such
counsel;
(ii) a pro forma estimated balance sheet
of the Acquired Businesses and the Company and
its Subsidiaries as of September 29, 1995, as
referred to in Section 6.01(g) giving effect to
the Acquisition and the transactions
contemplated thereby and hereby;
(iii) audited financial statements of the
Company and certain of its Subsidiaries for
Fiscal Year 1994;
(iv) audited financial statements of the
Acquired Businesses for Fiscal Year 1994, and
unaudited financial statements of the Acquired
Businesses prepared by management of the
Acquired Businesses for the period of Fiscal
Year 1995 ending on September 29, 1995;
(v) forecasts giving effect to the
Acquisition and the other transactions
contemplated thereby and hereby prepared by
management of the Company displaying (A) on a
quarterly basis, anticipated balance sheets as
at the end of each of the four quarterly
periods in 1996 and the related statements of
income and cash flow for each such period and
(B) on an annual basis, balance sheets as of
December 31, 1997 and December 31, 1998, and
the related projected statements of income and
cash flow for each such period; and
(vi) such additional documentation as the
Administrative Agent and the Lenders may
reasonably request.
(b) Perfection of Liens. All certificates
representing shares of Capital Stock included in the
Collateral (it being understood that the Capital Stock of
each of Hexcel Lyon, Brochier, Salver and CDSR is
represented by uncertificated securities) shall have been
delivered to the U.S. Administrative Agent (with duly
executed stock powers, as appropriate under applicable
law) and all instruments included in the Collateral shall
have been delivered to the U.S. Administrative Agent
(duly endorsed to the U.S. Administrative Agent, as
appropriate).
(c) No Legal Impediments. No law, regulation,
order, judgment or decree of any Governmental Authority
shall be in effect, and the Administrative Agent shall
not have received any notice that any action, suit,
investigation, litigation or proceeding is pending or
threatened in any court or before any arbitrator or
Governmental Authority, in either case that purports to
enjoin, prohibit, restrain or otherwise affect (A) the
making of the Loans on the Closing Date or (B) the
consummation of the transactions contemplated pursuant to
the Transaction Documents.
(d) No Change in Condition. No change in the
business, condition (financial or otherwise),
performance, properties, or prospects of (i) any Borrower
or Subsidiary Guarantor, individually, or of the Company
and its Subsidiaries, taken as a whole, shall have
occurred since December 31, 1995 or (ii) the Acquired
Businesses, taken as a whole, shall have occurred since
September 29, 1995, in each case, which change has had or
is reasonably likely, in the opinion of the Lenders, to
have a Material Adverse Effect.
(e) No Default. No Event of Default or
Default shall have occurred and be continuing or would
result from the making of the Loans.
(f) Representations and Warranties. All of
the representations and warranties contained in Section
6.01 and in any of the other Loan Documents (other than
representations that expressly speak as of a different
date) shall be true and correct on and as of the Closing
Date, both before and after giving effect to the making
of the Loans.
(g) Fees and Expenses Paid. There shall have
been paid to the Administrative Agent, for the account of
the Lenders, and to the Syndication Agent and the
Administrative Agent, for their respective individual
accounts, all fees (including, without limitation, the
reasonable legal fees of counsel to the Administrative
Agent and local counsel to the Administrative Agent for
the benefit of the Lenders) due and payable on or before
the Closing Date (including, without limitation, all such
fees described in the Citibank Letter Agreement, the
Credit Suisse Letter Agreement and in Section 4.03(c)),
and all reasonable expenses (including, without
limitation, reasonable legal expenses) due and payable on
or before the Closing Date.
(h) Consents, Etc. Except as set forth on
Schedule 6.01-D, each of the Company and its Subsidiaries
shall have received all consents and authorizations
required pursuant to any material Contractual Obligation
with any other Person, and shall have obtained all
consents and authorizations of, and effected all notices
to and filings with, any Governmental Authority as may be
necessary to allow each of the Company and its
Subsidiaries lawfully (A) to execute, deliver and
perform, in all material respects, their respective
obligations hereunder, under the other Transaction
Documents to which such Person is, or shall be, a party
and each other agreement or instrument to be executed and
delivered by each of them pursuant hereto or thereto or
in connection herewith or therewith and (B) to create and
perfect the Liens on the Collateral to be owned by each
of them in the manner and for the purpose contemplated by
the Loan Documents. No such consent or authorization
shall impose any conditions upon the Company or any of
its Subsidiaries that are reasonably likely to have a
Material Adverse Effect.
(i) Termination of the Existing Facility. The
obligations of the Company under the Existing Facility
shall have been terminated or shall be terminated
simultaneously with the execution hereof in accordance
with the terms hereof, all non-contingent obligations
thereunder shall have been paid or shall be paid in full
in cash simultaneously with the execution hereof in
accordance with the terms hereof and the Liens on the
Property of the Company securing the Existing Facility
shall have been released and terminated on terms
satisfactory to the Administrative Agent.
(j) The Acquisition. The Administrative Agent
and the Lenders shall be satisfied that: (i) the
Strategic Alliance Agreement, all other Ciba-Geigy
Transaction Documents and any other documentation
relating to the Acquisition, including, without
limitation, the agreements described in the Strategic
Alliance Agreement, shall have been duly approved and
executed and delivered by the parties thereto in form and
substance reasonably satisfactory to the Administrative
Agent and the Lenders, (ii) all conditions precedent to
closing under the Strategic Alliance Agreement and the
other Ciba-Geigy Transaction Documents shall have been
met prior to or simultaneous with the execution hereof
(and no modification or waiver of any such condition
shall have been made without the consent of the
Administrative Agent), (iii) such documents if, by their
terms, are to be entered into prior to or simultaneously
with the execution hereof, are, or simultaneously with
the execution hereof will be, in full force and effect in
accordance with their terms and (iv) the Acquisition has
been, or simultaneously with the funding hereof, will be,
consummated.
(k) Subordinated Notes. The Subordinated
Notes Indenture shall have been duly executed and
delivered by the parties thereto, shall provide for the
issuance of the Subordinated Notes and shall contain
provisions for the subordination of the Subordinated
Notes to the Obligations that are in form and substance
satisfactory to the Administrative Agent and the Lenders.
(l) Board of Directors. Prior to or
simultaneously with the execution hereof, the election by
the Board of Directors of the Company of directors
designated by Ciba-Geigy to serve on the Company's Board
of Directors shall be on terms consistent with the
Governance Agreement.
5.02. Conditions Precedent to All Subsequent
Revolving Loans, Swing Loans, European Overdraft Loans
and Letters of Credit. The obligation of each Lender to
make any Revolving Loan, of the Swing Loan Bank to make
any Swing Loan and of the European Overdraft Bank to make
any European Overdraft Loan requested to be made by it on
any date after the Closing Date, and the agreement of
each Issuing Bank to Issue any Letter of Credit on any
date after the Closing Date is subject to the following
conditions precedent as of each such date:
(a) Representations and Warranties. As of
such date, both before and after giving effect to the
Loans to be made or the Letter of Credit to be Issued on
such date, all of the representations and warranties of
the Borrower requesting such Loan or Letter of Credit and
its Subsidiaries contained in Section 6.01 and in any
other Loan Document (other than representations and
warranties that expressly speak as of a different date)
shall be true and correct as to such Borrower and its
Subsidiaries in all material respects.
(b) No Default. No Event of Default or
Default shall have occurred and be continuing or would
result from the making of the requested Loan or the
Issuance of the requested Letter of Credit.
(c) No Legal Impediments. No law, regulation,
order, judgment or decree of any Governmental Authority
shall, and the Administrative Agent shall not have
received from any Lender, the Swing Loan Bank, the
European Overdraft Bank or any Issuing Bank, as the case
may be, notice that, any action, suit, investigation,
litigation or proceeding is pending or threatened in any
court or before any arbitrator or Governmental Authority
that is likely to enjoin, prohibit or restrain, or, in
the reasonable judgment of such Person, impose or result
in the imposition of any material adverse condition upon,
(i) such Lender's making of the requested Loan or
participation in the requested Letter of Credit, (ii) the
Swing Loan Bank's making of the requested Swing Loan,
(iii) the European Overdraft Bank's making of the
requested European Overdraft Loan or (iv) such Issuing
Bank's Issuance of the requested Letter of Credit.
(d) No Material Adverse Change. No event
shall have occurred as to CML or Brochier since September
29, 1995, and as to the Company, Hexcel Lyon, Hexcel
Belgium and Hexcel UK, since December 31, 1995, in any
case which has or is reasonably likely, in the opinion of
the Requisite Lenders, to have a material adverse effect
on the business, condition (financial or otherwise),
performance, properties or prospects of the Borrower
requesting such Loan or Letter of Credit or the
Subsidiary Guarantors, taken as a whole, or of the
Company and its Subsidiaries, taken as a whole.
Each submission by any Borrower to the Administrative
Agent of a Notice of Borrowing with respect to a
Revolving Loan, Swing Loan or European Overdraft Loan,
each acceptance by any Borrower of the proceeds of each
such Loan so made, each submission by any Borrower to an
Issuing Bank of a request for Issuance of a Letter of
Credit and the Issuance of such Letter of Credit, shall
constitute a representation and warranty by such Borrower
as of the Funding Date in respect of such Revolving Loan,
as of the Swing Loan Funding Date in respect of such
Swing Loan, as of the European Overdraft Loan Funding
Date in respect of such European Overdraft Loan, and as
of the date of Issuance of such Letter of Credit, that
all the conditions contained in subsections (a), (b) and
(c) of this Section 5.02 have been satisfied or waived in
accordance with Section 13.07.
5.03. Conditions Precedent to the Making of
Loans and the Issuance of Letters of Credit to or for the
Benefit of Danutec Holdings or Danutec Werkstoff.
(a) Danutec Holdings. The obligation of each
Lender to make any Revolving Loan and of the European
Overdraft Bank to make any European Overdraft Loan
requested to be made by it by Danutec Holdings on any
date after the Closing Date, and the agreement of each
Issuing Bank to Issue any Letter of Credit to or on
behalf of Danutec Holdings on any date after the Closing
Date, shall be subject to the following conditions
precedent as of each such date (the date on which such
conditions precedent having been satisfied being referred
to herein as the "Danutec Holdings Effective Date"):
(i) Documents. The U.S. Administrative Agent
(on behalf of itself and the Lenders) shall have received
all of the following in form and substance reasonably
satisfactory to the U.S. Administrative Agent and the
Requisite Lenders:
(A) an agreement in the form attached
hereto as Exhibit L (a "Borrower Addendum"),
pursuant to which Danutec Holdings agrees to be
bound by the terms of this Agreement;
(B) the Notes required to be executed by
Danutec Holdings, a guaranty agreement substantially
in the form of the Foreign Subsidiary Guaranties
(which agreement, when so executed and delivered,
shall constitute one of the "Foreign Subsidiary
Guaranties" hereunder), each duly executed where
appropriate and in sufficient copies for each of the
Lenders, and an opinion of Austrian counsel;
(C) the Schedules to this Agreement, if
amended as of the Danutec Holdings Effective Date;
(D) the Constituent Documents of Danutec
Holdings as of the Danutec Holdings Effective Date;
and
(E) additional documents and certificates
similar to those provided by the other Foreign
Borrowers on the Closing Date, and such additional
documentation as the Administrative Agent and the
Lenders may reasonably request.
(ii) No Default. No Event of Default or
Default shall have occurred and be continuing or would
result from the making of the Loans to Danutec Holdings.
(iii) Representations and Warranties. As of
the Danutec Holdings Effective Date, both before and
after giving effect to the Loans to be made or the Letter
of Credit to be Issued on such date, all of the
representations and warranties contained in Section 6.01
and in any other Loan Document (other than
representations and warranties that expressly speak as of
a different date) shall be true and correct as to Danutec
Holdings and its Subsidiaries in all material respects.
(b) Danutec Werkstoff. The obligation of each
Lender to make any Revolving Loan and of the European
Overdraft Bank to make any European Overdraft Loan
requested to be made by it by Danutec Werkstoff on any
date after the Closing Date, and the agreement of each
Issuing Bank to Issue any Letter of Credit to or on
behalf of Danutec Werkstoff on any date after the Closing
Date, shall be subject to the following conditions
precedent as of each such date (the date on which such
conditions precedent having been satisfied being referred
to herein as the "Danutec Werkstoff Effective Date"):
(i) Documents. The U.S. Administrative Agent
(on behalf of itself and the Lenders) shall have received
all of the following in form substance satisfactory to
the Administrative Agent and the Requisite Lenders:
(A) a Borrower Addendum;
(B) the Notes required to be executed by
Danutec Werkstoff, a guaranty agreement
substantially in the form of the Foreign Subsidiary
Guaranties (which agreement, when so executed and
delivered, shall constitute one of the "Foreign
Subsidiary Guaranties" hereunder), and a pledge
agreement substantially in the form of the Foreign
Pledge Agreements, pursuant to which Danutec
Holdings pledges to the Administrative Agent the
shares of Danutec Werkstoff owned by it (which
agreement, when so executed and delivered, shall
constitute one of the "Foreign Pledge Agreements"
hereunder), each duly executed where appropriate and
in sufficient copies for each of the Lenders, and an
opinion of Austrian counsel;
(C) the Schedules to this Agreement, if
amended as of the Danutec Werkstoff Effective Date;
(D) the Constituent Documents of Danutec
Werkstoff as of the Danutec Werkstoff Effective
Date; and
(E) additional document and certificates
similar to those provided by the other Foreign
Borrowers on the Closing Date, and such additional
documentation as the Administrative Agent and the
Lenders may reasonably request.
(ii) Perfection of Liens. All certificates
representing shares of Capital Stock of Danutec Werkstoff
shall have been delivered to the U.S. Administrative
Agent (with duly executed stock powers, as appropriate
under applicable law) and all instruments included in the
Collateral shall have been delivered to the U.S.
Administrative Agent (duly endorsed to the U.S.
Administrative Agent, as appropriate).
(iii) No Default. No Event of Default or
Default shall have occurred and be continuing or would
result from the making of the Loans to Danutec Werkstoff.
(iv) Representations and Warranties. As of
the Danutec Werkstoff Effective Date, both before and
after giving effect to the Loans to be made or the Letter
of Credit to be Issued on such date, all of the
representations and warranties contained in Section 6.01
and in any other Loan Document (other than
representations and warranties that expressly speak as of
a different date) shall be true and correct as to Danutec
Werkstoff and its Subsidiaries in all material respects.
(c) Subsequent Loans and Letters of Credit to
be Made or Issued to Danutec Holdings or Danutec
Werkstoff. From and after the Danutec Holdings Effective
Date, the obligation of each Lender to make any Revolving
Loan and of the European Overdraft Bank to make any
European Overdraft Loan requested to be made by it by
Danutec Holdings on any date after the Danutec Holdings
Effective Date, and the agreement of each Issuing Bank to
Issue any Letter of Credit to or on behalf of Danutec
Holdings on any date after the Danutec Holdings Effective
Date, will be subject to the conditions precedent set
forth in Section 5.02. From and after the Danutec
Werkstoff Effective Date, the obligation of each Lender
to make any Revolving Loan and of the European Overdraft
Bank to make any European Overdraft Loan requested to be
made by it by Danutec Werkstoff on any date after the
Danutec Werkstoff Effective Date, and the agreement of
each Issuing Bank to Issue any Letter of Credit to or on
behalf of Danutec Werkstoff on any date after the Danutec
Werkstoff Effective Date, will be subject to the
conditions precedent set forth in Section 5.02.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
6.01. Representations and Warranties of the
Borrowers. In order to induce the Lenders and the
Issuing Banks to enter into this Agreement and to make
the Loans and the other financial accommodations to the
Borrowers and to Issue the Letters of Credit described
herein, each of the Borrowers represents and warrants
(only with respect to such Borrower and its Subsidiaries)
to each Lender, each Issuing Bank and the Administrative
Agent as follows:
(a) Organization; Corporate Powers. Each of
such Borrower and its Subsidiaries (i) is a corporation
or a company having limited liability duly organized,
validly existing and, to the extent applicable, is in
good standing under the laws of the jurisdiction of its
organization, (ii) is duly qualified to do business and
is in good standing (or, with respect to the Foreign
Subsidiaries, has maintained the equivalent status) under
the laws of each such jurisdiction, except where the
failure to be so qualified and in good standing (or, with
respect to the Foreign Subsidiaries, maintain equivalent
status) is not reasonably likely to have a Material
Adverse Effect and (iii) has all requisite power and
authority to own, operate and encumber its Property and
to conduct its business as presently conducted.
(b) Authority. (i) Each of such Borrower and
its Subsidiaries has the requisite power and authority to
execute, deliver and perform each of the Transaction
Documents to which it is a party.
(ii) The execution, delivery and performance,
as the case may be, of each of the Transaction Documents
to which any of such Borrower or its Subsidiaries is a
party, and the consummation of the transactions
contemplated thereby, have been duly authorized by such
Person's board of directors and (to the extent required
by law) the shareholders of such Person, and such
approvals have not been rescinded, revoked or modified in
any manner. No other corporate action or proceedings on
the part of such Borrower or its Subsidiaries is
necessary to consummate such transactions.
(iii) Each of the Transaction Documents to which
such Borrower or any of its Subsidiaries is a party has
been duly executed or delivered on behalf of such
Borrower or such Subsidiary, as the case may be, and
constitutes its legal, valid and binding obligation,
enforceable against such Person in accordance with its
terms except as such enforceability may be subject to
applicable bankruptcy, insolvency and reorganization laws
and similar laws or to general principles of equity, is
in full force and effect and, as of the Closing Date, no
term or condition thereof has been amended, modified or
waived from the terms and conditions contained in the
Transaction Documents delivered to the U.S.
Administrative Agent pursuant to Section 5.01(a) without
the prior written consent of the Requisite Lenders.
(c) Subsidiaries; Ownership of Capital Stock.
Schedule 6.01-C (i) contains a diagram indicating the
corporate structure of such Borrower and its Subsidiaries
and the Existing Joint Ventures of such Borrower as of
the Closing Date after giving effect to the Acquisition;
and (ii) accurately sets forth as of the Closing Date,
(A) the correct legal name, the jurisdiction of
incorporation and the Employer Identification Number (if
applicable) of each of such Borrower and its
Subsidiaries, and the jurisdictions in which each of such
Borrower and its Subsidiaries is qualified to transact
business as a foreign corporation, (B) the authorized,
issued and outstanding shares of each class of Capital
Stock of such Borrower and each of its Subsidiaries and,
with respect to such Borrower's Subsidiaries, the owners
of such shares and (C) a summary of the direct and
indirect partnership, joint venture or other equity
interests, if any, of such Borrower and each Subsidiary
of such Borrower in any Person that is not a corporation.
Except as set forth on Schedule 6.01-C, none of the
issued and outstanding Capital Stock of such Borrower or
such Borrower's Subsidiaries is subject to any vesting,
redemption or repurchase agreement, and there are no
warrants or options outstanding with respect to such
Capital Stock. The outstanding Capital Stock of each of
such Borrower and its Subsidiaries is duly authorized,
validly issued, fully paid and nonassessable and the
outstanding Capital Stock of each of such Borrower's
Subsidiaries is not Margin Stock.
(d) No Conflict. The execution, delivery and
performance of each of the Transaction Documents to which
such Borrower or any of its Subsidiaries is a party, do
not and shall not (i) except as set forth on Schedule
6.01-D, conflict with, result in a breach of or
constitute (with or without notice or lapse of time or
both) a default under any material Requirement of Law or
under any of the Transaction Documents, the Subordinated
Debentures, the Subordinated Debenture Indenture or any
other material Contractual Obligation of such Borrower or
any Subsidiary of such Borrower, or require the
termination of any material Contractual Obligation of
such Borrower or any of its Subsidiaries or (ii) result
in or require the creation or imposition of any Lien
whatsoever upon any of the Property or assets of such
Borrower or any of its Subsidiaries, other than Liens
contemplated by the Loan Documents.
(e) Strategic Alliance Agreement. The
Strategic Alliance Agreement is in full force and effect
and no material breach or default of any term or
provision thereof by any of such Borrower or its
Subsidiaries or by any other party thereto has occurred.
(f) Governmental Consents, Etc. Except as set
forth on Schedule 6.01-F, the execution, delivery and
performance of each of the Transaction Documents to which
such Borrower or any of its Subsidiaries is a party do
not and will not require any registration with, consent
or approval of, or notice to, or other action to, with or
by any Governmental Authority, except (i) filings,
consents or notices that have been made, obtained or
given, or, in a timely manner, will be made, obtained, or
given and (ii) filings necessary to perfect security
interests in, or to realize on pledges of, the
Collateral. Such Borrower is not subject to regulation
under the Public Utility Holding Company Act of 1935, the
Federal Power Act, the Interstate Commerce Act or the
Investment Company Act of 1940, or any other federal or
state statute or regulation that limits its ability to
incur Indebtedness or its ability to consummate the
transactions contemplated in the Transaction Documents.
(g) Projections. The Company's pro forma
estimated balance sheet referred to in Section
5.01(a)(ii) and each of the Company's business plans and
all other financial projections and related materials and
documents delivered to the Lenders pursuant hereto were
prepared in good faith on the basis of the assumptions
accompanying them, and such projections and assumptions
as of the date of preparation thereof were, and as of the
Closing Date are, reasonable in light of the then current
and foreseeable business conditions and prospects of the
Company and its Subsidiaries and represented management's
opinion of the Company's and its Subsidiaries' projected
financial performance based on the information available
to the Company at the time so furnished, it being
understood that nothing contained in this Section shall
constitute a representation or warranty that such future
financial performance or results of operations will in
fact be achieved.
(h) Litigation; Adverse Effects. Except as
set forth on Schedule 6.01-H, there is no action, suit,
audit, proceeding, investigation or arbitration (or
series of related actions, suits, proceedings,
investigations or arbitrations) before or by any
Governmental Authority or private arbitrator pending or,
to the knowledge of any Borrower, threatened against such
Borrower or any of its Subsidiaries or any Property of
any of them (i) challenging the validity or the
enforceability of any of the Transaction Documents, or
(ii) that is reasonably likely to have a Material Adverse
Effect.
(i) Payment of Taxes. All tax returns and
reports of each of such Borrower and its Subsidiaries
required to be filed have been timely filed, and, except
as set forth on Schedule 6.01-I hereto, all material
taxes, assessments, fees and other governmental charges
thereupon and upon their respective Property, assets,
income and franchises that are shown in such returns or
reports to be due and payable have been paid, other than
such taxes, assessments, fees and other governmental
charges (i) that are being contested in good faith by
such Borrower or any of its Subsidiaries, as the case may
be, by appropriate proceedings conducted in good faith
and without danger of any material risk to the Collateral
and (ii) with respect to which a reserve or other
appropriate provision, if any, as is required in
conformity with GAAP shall have been made. None of such
Borrower or any of its Subsidiaries has any knowledge of
any proposed tax assessment against such Borrower or any
of its Subsidiaries that shall have or is reasonably
likely to have a Material Adverse Effect.
(j) Performance. Neither such Borrower nor
any of its Subsidiaries has received notice or has actual
knowledge that (i) it is in default in the performance,
observance or fulfillment of any of the obligations,
covenants or conditions contained in any Contractual
Obligation applicable to it or (ii) any condition exists
that, with the giving of notice or the lapse of time or
both, would constitute a default with respect to any such
Contractual Obligation, in each case, except where such
default or defaults, if any, shall not have or are not
reasonably likely to have a Material Adverse Effect.
(k) Disclosure. All factual information
(taken as a whole) furnished by or on behalf of such
Borrower or its Subsidiaries in writing to the
Administrative Agent or any Lender on or prior to the
Closing Date for purposes of, or in connection with, this
Agreement or any of the Loan Documents, including,
without limitation, the Proxy Statement of the Company
dated January 22, 1996, is, and all other factual
information (taken as a whole) provided in writing to the
Administrative Agent or any Lender will be, true and
accurate in all material respects on the date as of which
such information is dated or furnished and not incomplete
by omitting to state any material fact necessary to make
such information (taken as a whole) not misleading at
such time.
(l) Requirements of Law. Except as set forth
on Schedule 6.01-L, each of such Borrower and its
Subsidiaries is in compliance with all Requirements of
Law, in each case except where the failure to so comply
individually or in the aggregate is not reasonably likely
to have a Material Adverse Effect.
(m) Environmental Matters. Except as set
forth on Schedule 6.01-M:
(A) neither such Borrower nor any of its
Subsidiaries nor any of their respective operations
or present or past Property are subject to any
investigation by, or any judicial or administrative
proceeding, order, judgment, settlement, decree or
other agreement alleging or addressing (i) a
material violation of any Environmental, Health or
Safety Requirement of Law; (ii) any Remedial Action;
or (iii) any material Claims or Liabilities and
Costs arising from the Release or threatened Release
of a Contaminant into the environment, nor has such
Borrower or its Subsidiaries received any notice of
the foregoing, except, in each case, for any matter
that, individually or in the aggregate is not
reasonably likely to have a Material Adverse Effect;
(B) neither such Borrower nor any of its
Subsidiaries is the owner or operator of any
Property that has any of the following that would
reasonably be likely to have a Material Adverse
Effect:
(i) any past or present on-site
generation, treatment, recycling, storage or
disposal of any hazardous waste, as that term
is defined under 40 C.F.R. Part 261 or any
state or local equivalent;
(ii) any past or present landfill, waste-
pile, underground storage tank or surface
impoundment;
(iii) any asbestos-containing material; or
(iv) any polychlorinated biphenyls (PCBs)
used in hydraulic oils, electrical transformers
or other Equipment;
(C) or otherwise disclosed to the
Administrative Agent, no Environmental Lien has
attached to any Property of such Borrower or any of
its Subsidiaries;
(D) there have been no Releases of any
Contaminants into the environment in reportable
quantities by such Borrower or its Subsidiaries that
would reasonably be likely to have a Material
Adverse Effect;
(E) neither such Borrower nor any of its
Subsidiaries has any contingent liability in
connection with any Release or threatened Release of
any Contaminants into the environment that would
reasonably be likely to have a Material Adverse
Effect;
(F) neither such Borrower nor any of its
Subsidiaries has sent or directly arranged for the
transport of any waste to any site listed or
proposed for listing on the National Priorities List
("NPL") pursuant to CERCLA or on the Comprehensive
Environmental Response Compensation Liability
Information System List ("CERCLIS"), or any similar
state list, the effect of which would reasonably be
likely to have a Material Adverse Effect;
(G) neither such Borrower's nor any of its
Subsidiaries' present or past Property is listed or
proposed for listing on the NPL pursuant to CERCLA
or on the CERCLIS or any similar state list of sites
requiring Remedial Action, and such Borrower and its
Subsidiaries are unaware of any conditions on such
Property that would qualify such Property for
inclusion on any such list, except, in either case,
where such listing would not reasonably be likely to
have a Material Adverse Effect;
(H) neither such Borrower nor any of its
Subsidiaries is subject to any Environmental
Property Transfer Act as a result of the
transactions contemplated by the Loan Documents or,
to the extent such acts are applicable to any such
property, such Borrower has fully complied with the
requirements of such acts, except where the failure
to comply would not reasonably be likely to have a
Material Adverse Effect.
(n) ERISA Matters. As of the Closing Date,
neither such Borrower, nor its Subsidiaries nor any ERISA
Affiliate maintains or contributes to any Plan other than
those listed on Schedule 6.01-N hereto. With respect to
each Plan that is intended to be qualified under Section
401(a) of the Internal Revenue Code as currently in
effect, such Borrower, its Subsidiaries or an ERISA
Affiliate has received or is in the process of seeking, a
favorable determination letter from the Internal Revenue
Service that the Plan is so qualified and that each trust
related to any such Plan is exempt from federal income
tax under Section 501(a) of the Internal Revenue Code as
currently in effect. None of such Borrower, any of its
Subsidiaries or any ERISA Affiliate knows of any reason
why such Plans or trusts are not qualified. Except as
disclosed on Schedule 6.01-N, as of the Closing Date,
neither such Borrower nor any of its Subsidiaries
maintains or contributes to any employee welfare benefit
plan within the meaning of Section 3(l) of ERISA that
provides benefits to employees after termination of
employment other than as required by Section 601 of
ERISA. To the extent such Borrower knows or reasonably
should know, such Borrower, its Subsidiaries and all of
its ERISA Affiliates are in compliance in all material
respects with the responsibilities, obligations or duties
imposed on them by ERISA, the Internal Revenue Code and
regulations promulgated thereunder with respect to all
Plans. No Benefit Plan has incurred any accumulated
funding deficiency (as defined in Sections 302(a)(2) of
ERISA and 412(a) of the Internal Revenue Code), whether
or not waived, that would subject such Borrower or any
ERISA Affiliate to a liability in excess of $1,000,000.
Neither such Borrower, nor any of its Subsidiaries nor
any ERISA Affiliate nor, to the knowledge of such
Borrower, any fiduciary of any Plan that is not a
Multiemployer Plan (i) has engaged in a nonexempt
prohibited transaction described in Sections 406 of ERISA
or 4975 of the Internal Revenue Code or (ii) has taken or
failed to take any action that would constitute or result
in a Termination Event that would, in either case,
subject such Borrower, any of its Subsidiaries or any
ERISA Affiliate to a liability in excess of $1,000,000.
Neither of such Borrower, nor any of its Subsidiaries or
any ERISA Affiliate has incurred any potential liability
under Sections 4063, 4064, 4069, 4204 or 4212(c) of ERISA
in excess of $1,000,000. Neither of such Borrower, nor
any of its Subsidiaries or any ERISA Affiliate has
incurred any liability to the PBGC that remains
outstanding that would subject such Borrower, any of its
Subsidiaries or any ERISA Affiliate to a liability in
excess of $2,000,000. There are no premium payments that
have become due to the PBGC that are unpaid. To the
extent filed, Schedule B to the most recent annual report
filed with the IRS with respect to each Benefit Plan and
furnished to the Administrative Agent is complete and
accurate. Since the date of each such Schedule B, there
has been no material adverse change in the funding status
or financial condition of the Benefit Plan relating to
such Schedule B. Neither of such Borrower, nor any of
its Subsidiaries or any ERISA Affiliate has (i) failed to
make a required contribution or payment to a
Multiemployer Plan or (ii) made a complete or partial
withdrawal under Sections 4203 or 4205 of ERISA from a
Multiemployer Plan. Except as disclosed on Schedule
6.01-N, neither of such Borrower, nor any of its
Subsidiaries or any ERISA Affiliate has failed to make a
required installment or any other required payment under
Section 412 of the Internal Revenue Code on or before the
due date for such installment or other payment. Neither
of such Borrower, nor any of its Subsidiaries or any
ERISA Affiliate is required to provide security to a
Benefit Plan under Section 401(a)(29) of the Internal
Revenue Code due to a Plan amendment that results in an
increase in current liability for the plan year. To the
extent such Borrower knows or reasonably should know,
such Borrower does not have, by reason of the
transactions contemplated hereby, any obligation to make
any payment to any employee pursuant to any Plan or
existing contract or arrangement.
(o) Foreign Employee Benefit Matters. Each
Foreign Employee Benefit Plan is in compliance in all
material respects with all Requirements of Law applicable
thereto and the respective requirements of the governing
documents for such Foreign Employee Benefit Plan. Except
as set forth on Schedule 6.01-O the aggregate of the
liabilities to provide all of the accrued benefits under
any Foreign Pension Plan does not exceed the current fair
market value of the assets held in the trust or other
funding vehicle for such Foreign Employee Benefit Plan by
an amount in excess of $2,000,000. With respect to any
Foreign Employee Benefit Plan maintained by such
Borrower, any of its Subsidiaries or any ERISA Affiliate
(other than a Foreign Pension Plan), reasonable reserves
have been established in accordance with prudent business
practice or where required by ordinary accounting
practices in the jurisdiction in which such Foreign
Employee Benefit Plan is maintained. The aggregate
unfunded liabilities, after giving effect to any reserves
for such liabilities, with respect to such Foreign
Employee Benefit Plans are not material. Except as set
forth on Schedule 6.01-O, there are no actions, suits or
claims (other than routine claims for benefits) pending
or, to the knowledge of such Borrower, threatened against
such Borrower, any of its Subsidiaries or any ERISA
Affiliate with respect to any Foreign Employee Benefit
Plan that would subject such Borrower, any of its
Subsidiaries or an ERISA Affiliate to a liability in
excess of $2,000,000.
(p) Labor Matters. (i) Except as set forth on
Schedule 6.01-P, as of the Closing Date there is no
collective bargaining agreement covering any of the
employees of such Borrower or any of its Subsidiaries.
To the knowledge of such Borrower, except as set forth on
Schedule 6.01-P, as of the Closing Date no attempt to
organize the employees of such Borrower or any of its
Subsidiaries is pending, threatened, planned or
contemplated.
(ii) There are no strikes, work stoppages,
slowdowns or lockouts pending or, to the knowledge of
such Borrower or its Subsidiaries, threatened against or
involving such Borrower or any of its Subsidiaries, other
than those that in the aggregate would not have or be
reasonably likely to have a Material Adverse Effect.
(iii) There are no arbitrations or grievances
pending against or involving such Borrower or any of its
Subsidiaries, nor are there, to the knowledge of such
Borrower or its Subsidiaries, any arbitrations or
grievances threatened involving such Borrower or any of
its Subsidiaries, other than those that in the aggregate,
if resolved adversely to such Borrower or such
Subsidiary, would not have or be reasonably likely to
have a Material Adverse Effect.
(q) Securities Activities. None of such
Borrower or any of its Subsidiaries is engaged in the
business of extending credit for the purpose of
purchasing or carrying Margin Stock.
(r) Solvency. After giving effect to the
transactions contemplated in the Transaction Documents,
the payment and accrual of all Transaction Costs payable
on the Closing Date, the Loans to be made on the Closing
Date or such other date as Loans requested hereunder are
made and the disbursement of the proceeds of such Loans
pursuant to such Borrower's instructions, each of such
Borrower and its Subsidiaries is or will be Solvent.
(s) Insurance. On and as of the Closing Date,
all policies of insurance of any kind or nature owned by
or issued to the Company and/or any of its Subsidiaries,
including, without limitation, policies of life, fire,
theft, product liability, public liability, property
damage, other casualty, employee fidelity, workers
compensation and employee health and welfare insurance,
are in full force and effect and are of a nature and
provide such coverage as is sufficient in the reasonable
judgment of the Company and as is customarily carried in
the same general area by companies engaged in the same or
similar businesses of the size and character of such
Person.
(t) Government Contracts. (i) Except as set
forth on Schedule 6.01-T, none of such Borrower or any of
its Subsidiaries or any of their respective Affiliates is
party to any Contractual Obligation or subject to any
Requirement of Law as a result of any conflict of
interest by, between or among such Borrower, such
Subsidiaries or such Affiliates or otherwise that would
result in the termination of any Government Contract or
that would impose any limitation on such Borrower's or
such Subsidiary's ability to perform any such Government
Contract, except where such termination or limitation is
not reasonably likely to have a Material Adverse Effect,
or to continue its business substantially as presently
conducted and proposed to be conducted.
(ii) Except as set forth on Schedule 6.01-T,
(A) none of such Borrower or any of its Subsidiaries or
any of their respective directors, officers or employees
is (or during the last three (3) years has been) under
administrative, civil or criminal investigation or
indictment by any Governmental Authority, with respect to
any alleged irregularity, misstatement or omission
arising under or relating to any Government Contract; and
(B) during the last three (3) years, none of such
Borrower or any of its Subsidiaries has conducted or
initiated any internal investigation or made a voluntary
disclosure to the United States Government with respect
to any alleged irregularity, misstatement or omission
arising under or relating to a Government Contract, in
each case except (with respect to such matters occurring
after the Closing Date) as disclosed to the Lenders.
(iii) Except as set forth on Schedule 6.01-T,
there exist (A) no outstanding claims against such
Borrower or any of its Subsidiaries, either by the United
States Government or by any prime contractor,
subcontractor, vendor or other third party, arising under
or relating to any Government Contract which, if
adversely resolved against such Borrower or such
Subsidiary, are reasonably likely to have a Material
Adverse Effect; and (B) no disputes between such Borrower
or any of its Subsidiaries and the United States
Government under the Contract Disputes Act or any other
Federal statute or between such Borrower or any of its
Subsidiaries and any prime contractor, subcontractor or
vendor arising under or relating to any such Government
Contract which, if adversely resolved against such
Borrower or such Subsidiary, are reasonably likely to
have a Material Adverse Effect.
(iv) Except as set forth on Schedule 6.01(T) or
(with respect to such matters occurring after the Closing
Date) as disclosed to the Lenders, none of such Borrower
or any of its Subsidiaries or any of their respective
directors, officers or employees is (or during the last
three (3) years has been) suspended or debarred from
doing business with the United States Government or is
(or during such period was) the subject of a finding of
nonresponsibility or ineligibility for United States
Government contracting.
(u) Financial Statements. The (i) audited
consolidated balance sheets of the Company and its
Subsidiaries as at December 31, 1994 and the related
audited consolidated statements of income and of cash
flows for the year then ended and (ii) unaudited
consolidated balance sheet of the Company and its
Subsidiaries as at October 1, 1995 and the related
consolidated statements of income and cash flows for the
periods then ended, including the related notes and
schedules thereto, are complete and correct in all
material respects, have been prepared in accordance with
GAAP, and present fairly the consolidated financial
position, results of operations and cash flows of the
Company and its Subsidiaries as at the dates and for the
periods indicated.
ARTICLE VII
REPORTING COVENANTS
Each of the Borrowers covenants and agrees that
as long as any Commitment is outstanding and thereafter
until payment in full of all of the Obligations, unless
the Requisite Lenders shall otherwise give prior written
consent thereto:
7.01. Financial Statements. The Company shall
maintain, and shall cause each of its Subsidiaries to
maintain, a system of accounting established and
administered in accordance with sound business practices
to permit preparation of consolidated and consolidating
financial statements in conformity with GAAP, and each of
the financial statements described below shall be
prepared from such system and records. The Company shall
deliver or cause to be delivered to the Administrative
Agent and the Lenders:
(a) Monthly Reports. As soon as available and
in any event within thirty (30) days after the end of
each fiscal month (other than the fiscal month
immediately following the Closing Date, in which case,
within forty-five (45) days thereafter) in each Fiscal
Year, unaudited consolidated balance sheets of the
Company and its Subsidiaries, in each case as at the end
of such period, and the related statements of income and
cash flow for such fiscal month and for the period from
the beginning of the then current Fiscal Year to the end
of such fiscal month, and for the corresponding period
during the previous Fiscal Year together with the
comparison to the current annual budget for such period,
all certified by the chief financial officer, treasurer
or controller of the Company as fairly presenting the
consolidated financial position of the Company and its
Subsidiaries as at the dates indicated, the results of
their operations and cash flow for the periods indicated
in accordance with GAAP, subject to normal year-end
adjustments.
(b) Quarterly Reports. As soon as available
and in any event within forty-five (45) days after the
end of each fiscal quarter of each Fiscal Year, the
unaudited consolidated and consolidating balance sheets
of the Company and its Subsidiaries as at the end of such
period and the related statements of income and cash flow
for such fiscal quarter and for the period from the
beginning of the then current Fiscal Year to the end of
such fiscal quarter, and for the corresponding period
during the previous Fiscal Year together with the
comparison to the current annual budget for such period,
all certified by the chief financial officer, treasurer,
controller or the senior vice president for finance and
administration of the Company as fairly presenting the
financial position of the Company and its Subsidiaries,
as at the dates indicated and the results of their
operations and cash flow for the periods indicated in
accordance with GAAP, subject to normal year end
adjustments.
(c) Annual Reports. As soon as available and
in any event within ninety (90) days after the end of
each Fiscal Year, audited consolidated financial
statements of the Company and its Subsidiaries, certified
with respect to such consolidated statements by a firm of
independent certified public accountants of recognized
national standing reasonably acceptable to the
Administrative Agent, which report (x) shall be certified
without qualification or modification as to the scope of
the audit and as to the Company being a going concern,
(y) shall state that such financial statements fairly
present the financial position of the Company and its
Subsidiaries as at the dates indicated and the results of
their operations and cash flow for the periods indicated
in conformity with GAAP applied on a basis consistent
with prior years (except for changes with which such
independent certified public accountants shall concur and
which shall have been disclosed in the notes to the
financial statements) and (z) shall state that the
examination by such accountants in connection with such
consolidated financial statements has been made in
accordance with generally accepted auditing standards.
The financial statements referred to above shall be
accompanied by a copy of the management letter or any
similar report delivered to the Borrower or to any
officer or employee thereof by such accountants in
connection with such financial statements.
(d) Officer's Certificate. Together with each
delivery of any financial statement pursuant to
paragraphs (b) and (c) of this Section 7.01, an Officer's
Certificate of the Company substantially in the form of
Exhibit E (the "Compliance Certificate"), signed by the
Company's chief financial officer, treasurer, controller
or senior vice president for finance and administration
and setting forth calculations for the period then ended
for Section 3.01(b) (including, without limitation,
calculations of Net Cash Proceeds and mandatory
prepayments pursuant to Section 3.01(b)), the negative
covenants of Article IX and the financial covenants of
Article X.
(e) Business Plans; Financial Projections. As
soon as available and in any event within thirty (30)
days prior to the end of each Fiscal Year, a combined
annual budget (in the format customarily utilized by the
Company for making financial projections) of (i) the
Company and the Domestic Subsidiaries, (ii) each Foreign
Borrower and (iii) the Company and its Subsidiaries for
the succeeding Fiscal Year, displaying on a monthly basis
anticipated balance sheets as at the end of such period
and the related statements of income and cash flow of
each of the Persons described in clauses (i) through
(iii).
(f) Accountants' Statement. Together with
each delivery of the financial statements referred to in
Section 7.01(c), a written statement of a firm of
independent certified public accountants of recognized
national standing reasonably acceptable to the
Administrative Agent, giving the report stating (i) that
their audit examination has included a review of the
terms hereof as it relates to accounting matters and (ii)
whether, in connection with their audit examination, any
Event of Default or Default has come to their attention,
and if such Event of Default or Default has come to their
attention, specifying the nature and period of existence
thereof.
(g) Exon-Florio Filing. A copy of the Exon-
Florio filing made on November 2, 1995.
(h) Hexcel Pottsville Corporation. Within
thirty (30) days of their delivery in accordance with
Sections 9.02 and 11.08 of the Special Security Agreement
dated as of February __, 1996, by and among Ciba-Geigy,
the Company, Hexcel Pottsville Corporation and the United
States Department of Defense (the "Special Security
Agreement"), copies of the annual implementation and
compliance report and the quarterly report to Affiliates
required to be delivered pursuant to Sections 9.02 and
11.08, respectively, of the Special Security Agreement.
7.02. Events of Default. Promptly upon (and,
in any event, within ten (10) days of) any Financial
Officer of any of the Borrowers obtaining knowledge
(i) of an Event of Default or Default, or becoming aware
that any Lender, any Issuing Bank or the Administrative
Agent has given any written notice with respect to a
claimed Event of Default or Default, (ii) that any Person
has given any written notice to the Company or any of its
Subsidiaries or taken any other action with respect to a
claimed default or event or condition of the type
referred to in Section 11.01(e), or (iii) of any other
condition or event that has or is reasonably likely to
have a Material Adverse Effect or materially and
adversely affect the value of, or the Administrative
Agent's interest in, the Collateral, the Company shall
deliver to the Administrative Agent and the Lenders an
Officer's Certificate specifying (A) the nature and
period of existence of any such claimed default, Event of
Default, Default, condition or event, (B) the notice
given or action taken by such Person in connection
therewith, and (C) the remedial action the Company or its
Subsidiary has taken, is taking and proposes to take with
respect thereto.
7.03. Lawsuits. (i) Promptly upon (and in
any event, within ten (10) Business Days of) any of the
Borrowers obtaining knowledge of the institution of, or
written threat of, any action, suit, proceeding,
governmental investigation or arbitration against or
affecting the Company or any of its Subsidiaries or any
Property of the Company or any of its Subsidiaries not
previously disclosed pursuant to Section 6.01(h), which
action, suit, proceeding, governmental investigation or
arbitration would reasonably be likely to have, or in the
case of multiple actions, suits, proceedings,
governmental investigations or arbitrations arising out
of the same general allegations or circumstances would
reasonably be likely to have, in such Borrower's
reasonable judgment, a Material Adverse Effect, in each
case after taking into effect applicable insurance
coverage, the Company shall give written notice thereof
to the Administrative Agent, the Issuing Banks and the
Lenders and provide such other information as may be
reasonably available to enable each Lender, the Issuing
Banks and Administrative Agent and its counsel to
evaluate such matters; and (ii) in addition to the
requirements set forth in clause (i) of this
Section 7.03, the Company, upon reasonable request of the
Administrative Agent or the Requisite Lenders, shall
promptly give written notice of the status of any action,
suit, proceeding, governmental investigation or
arbitration covered by a report delivered pursuant to
clause (i) above and provide such other information as
may be reasonably available to it (subject to applicable
attorney-client privilege) to enable each Lender, each
Issuing Bank and the Administrative Agent and its counsel
to evaluate such matters.
7.04. ERISA Notices. The Company shall
deliver or cause to be delivered to the Administrative
Agent, at the Company's expense, the following
information and notices as soon as reasonably possible,
and in any event:
(i) within ten (10) Business Days after
the Company or any ERISA Affiliate knows or
reasonably should know that a Termination Event
has occurred, a written statement of the chief
financial officer of the Company describing
such Termination Event and the action, if any,
that the Company or any ERISA Affiliate has
taken, is taking or proposes to take with
respect thereto, and when known, any action
taken or threatened by the IRS, DOL or PBGC
with respect thereto;
(ii) within ten (10) Business Days after
the Company or any ERISA Affiliate knows or
reasonably should know that a prohibited
transaction (as defined in Sections 406 of
ERISA and 4975 of the Internal Revenue Code)
has occurred for which a statutory or class
exemption is not available or a private
exemption has not been previously obtained from
the DOL, a statement of the chief financial
officer of the Company describing such
transaction and the action that the Company or
any ERISA Affiliate has taken, is taking or
proposes to take with respect thereto;
(iii) within ten (10) Business Days after
the filing thereof with the DOL, IRS or PBGC,
copies of each annual report (form 5500
series), including Schedule B thereto, filed
with respect to each Benefit Plan;
(iv) within ten (10) Business Days after
receipt by the Company or any ERISA Affiliate
of each actuarial report for any Benefit Plan
or Multiemployer Plan and each annual report
for any Multiemployer Plan, copies of each such
report;
(v) within ten (10) Business Days after
the filing thereof with the IRS, a copy of each
funding waiver request filed with respect to
any Benefit Plan and, if requested by the
Administrative Agent, all communications
received by the Company or any ERISA Affiliate
with respect to such request;
(vi) within ten (10) Business Days after
the occurrence thereof, notification of any
material increase in the benefits of any
existing Benefit Plan or the establishment of
any new Benefit Plan or the commencement of
contributions to any Benefit Plan to which the
Company or any ERISA Affiliate was not
previously contributing;
(vii) within ten (10) Business Days after
receipt by the Company or any ERISA Affiliate
of the PBGC's intention to terminate a Benefit
Plan or to have a trustee appointed to
administer a Benefit Plan, copies of each such
notice;
(viii) within ten (10) Business Days after
receipt by the Company or any ERISA Affiliate
of any unfavorable determination letter from
the IRS regarding the qualification of a Plan
under Section 401(a) of the Internal Revenue
Code, copies of each such letter;
(ix) within ten (10) Business Days after
receipt by the Company or any ERISA Affiliate
of a notice from a Multiemployer Plan regarding
the imposition of withdrawal liability, copies
of each such notice;
(x) within ten (10) Business Days after
the Company or any ERISA Affiliate fails to
make a required installment or any other
required payment under Section 412 of the
Internal Revenue Code on or before the due date
for such installment or payment, a notification
of such failure;
(xi) within ten (10) Business Days after
the Company or any ERISA Affiliate knows or
reasonably should know (A) a Multiemployer Plan
has been terminated, (B) the administrator or
plan sponsor of a Multiemployer Plan intends to
terminate a Multiemployer Plan, or (C) the PBGC
has instituted or will institute proceedings
under Section 4042 of ERISA to terminate a
Multiemployer Plan; and
(xii) within ten (10) Business Days after
receipt by the Company of a written notice from
the Administrative Agent, copies of any Foreign
Employee Benefit Plan and related documents,
reports and correspondence as requested by the
Administrative Agent in such notice.
For purposes of this Section 7.05, the Company and any
ERISA Affiliate shall be deemed to know all facts known
by the administrator of any Plan of which the Company or
any ERISA Affiliate is the plan sponsor.
7.05. Environmental Notices. (a) The Company
shall notify the Administrative Agent and the Lenders in
writing, promptly and in any event within 10 Business
Days after any Borrower knows thereof, of any:
(i) notice or claim by a Governmental
Authority or any third party to the effect that the
Company or any of its Subsidiaries is or may be
liable to any Person, or is subject to an
investigation by a Governmental Authority, relating
to a material Release or threatened Release of any
Contaminant into the environment;
(ii) notice that any Property of the Company or
any of its Subsidiaries is subject to an
Environmental Lien;
(iii) commencement or threat of any judicial or
administrative proceeding alleging a material
violation by the Company or any of its Subsidiaries
of any Environmental, Health or Safety Requirement
of Law;
(iv) new and material changes to any existing
Environmental, Health or Safety Requirement of Law
that would reasonably be likely to have a Material
Adverse Effect; or
(v) any intent to execute an agreement, letter
of intent or commitment to acquire stock, assets or
real estate, or to lease property, or to take any
other action by the Company or any of its
Subsidiaries that would subject the Company or any
of its Subsidiaries to environmental, health or
safety Liabilities and Costs that would reasonably
be likely to have a Material Adverse Effect.
(b) The Company shall notify the
Administrative Agent and the Lenders in writing, promptly
and in any event within 25 Business Days after any filing
or report made by the Company or any of its Subsidiaries
with any Governmental Authority with respect to (i) the
material violation of any Environmental, Health or Safety
Requirement of Law, (ii) any material unpermitted Release
or threatened Release of a Contaminant or (iii) any
material unsafe or unhealthful condition at any Property
of the Company or its Subsidiaries.
(c) On March 31 of each calendar year,
commencing on March 31, 1996, the Company shall submit to
the Administrative Agent and the Lenders a report
prepared by the appropriate officers of the Company
summarizing the status of any environmental, health or
safety non-compliance, hazard or liability issues
identified in notices required pursuant to Section
7.05(a), disclosed on Schedule 6.01-M or identified in
any notice or report required hereby. Such report shall
identify the cash expenditures for Liabilities and Costs
arising out of or relating to such environmental health
or safety matters made by the Company and its
Subsidiaries during the previous calendar year.
7.06. Labor Matters. The Company shall notify
the Administrative Agent and the Lenders in writing,
promptly after any such Borrower knows thereof, of
(i) any material labor dispute to which such Borrower or
any of its Subsidiaries is or may become a party,
including, without limitation, any strikes, lockouts or
other disputes relating to such Person's plants and other
facilities and (ii) any Worker Adjustment and Retraining
Notification Act or related liability incurred with
respect to the closing of any plant or other facility of
such Persons.
7.07. Public Filings and Reports. Promptly
upon the filing thereof with any Governmental Authority
(including, without limitation, the SEC) or the mailing
thereof to the public shareholders or debtholders of the
Company generally, the Company shall deliver to the
Administrative Agent and the Lenders copies of all
filings or reports made in connection with outstanding
Indebtedness or Capital Stock of the Company.
7.08. Government Contracts. (i) The Company
shall notify the Administrative Agent and the Lenders in
writing promptly after any Borrower knows thereof, of any
loss or threatened loss of the security clearances
necessary for the operation of the Company's Government
Contracts business unless disclosure thereof is
prohibited by any Requirement of Law; and (ii) the
Company shall notify the Administrative Agent in writing
promptly upon (and, in any event, within five (5)
Business Days after) any Borrower obtaining knowledge of
any material change in the status of any action, suit,
proceeding, governmental investigation or other matter
disclosed on or arising out of the matters disclosed on
Schedule 6.01-T and shall provide such other information
as may be reasonably available to it to enable each
Lender and the Administrative Agent and its counsel to
evaluate such matters.
7.09. Other Information. Promptly upon
receipt of a reasonable request therefor from the
Administrative Agent, the Company shall prepare and
deliver to the Administrative Agent and the Lenders such
other information with respect to the Company, any of the
Company's Subsidiaries or the Collateral including,
without limitation, schedules identifying and describing
the Collateral and any dispositions thereof and copies of
each existing written agreement or arrangement set forth
on Schedule 6.01-T, as from time to time may be
reasonably requested by the Administrative Agent.
ARTICLE VIII
AFFIRMATIVE COVENANTS
Each of the Borrowers covenants and agrees that
as long as any Commitment is outstanding and thereafter
until payment in full of all of the Obligations, unless
the Requisite Lenders shall otherwise give prior written
consent:
8.01. Corporate Existence, Etc. Such Borrower
shall, and shall cause each of its Subsidiaries to, at
all times maintain its respective corporate
existence and preserve and keep, or cause to be preserved
and kept, in full force and effect, their respective
rights and franchises material to their respective
businesses, except where the failure to maintain or
preserve such rights and franchises would not reasonably
be likely to have a Material Adverse Effect.
8.02. Corporate Powers; Conduct of Business,
Etc. Such Borrower shall, and shall cause each of its
Subsidiaries to, qualify and remain qualified to do
business in each jurisdiction in which the nature of its
business requires it to be so qualified, except where the
failure to be so qualified would not reasonably be likely
to have a Material Adverse Effect.
8.03. Compliance with Laws, Etc. Such
Borrower shall, and shall cause each of its Subsidiaries
to, (a) comply with all Requirements of Law and all
restrictive covenants (except, in each case, as set forth
on the Schedules hereto) affecting such Person or the
business, Property or operations of such Person, and (b)
obtain as needed all Permits necessary for such Person's
operations and maintain such Permits in good standing,
except, in each case, where the failure to do so would
not reasonably be likely to have a Material Adverse
Effect.
8.04. Payment of Taxes and Claims; Tax
Consolidation. Such Borrower shall, and shall cause each
of its Subsidiaries to, pay (a) all taxes, assessments
and other governmental charges imposed upon it or on any
of its Property or in respect of any of its franchises,
business, income or Property before any penalty or
interest for late payment (except as such penalty or
interest relates to underpayment of estimated tax
payments) accrues thereon, and (b) all claims (including,
without limitation, claims for labor, services, materials
and supplies) for sums that have become due and payable
and that by law have or may become a Lien (other than a
Lien permitted by Section 9.03) upon any of such
Borrower's or such Subsidiary's Property, prior to the
time when any penalty or fine shall be incurred with
respect thereto; provided, that no such taxes,
assessments and governmental charges referred to in
clause (a) above or claims referred to in clause (b)
above are required to be paid if being contested in good
faith by such Borrower or such Subsidiary, as the case
may be, by appropriate proceedings conducted in good
faith and without danger of any material risk to the
Collateral, and if such reserves or other appropriate
provision, if any, as shall be required in conformity
with GAAP shall have been made therefor. Such Borrower
shall not permit any of its Subsidiaries to file or
consent to the filing of any consolidated income tax
return with any Person (other than the Company and its
Subsidiaries).
8.05. Insurance. The Company shall maintain
for itself and its Subsidiaries, or shall cause each of
its Subsidiaries to maintain, with financially sound and
reputable insurance companies, insurance on itself and
its Properties in at least such amounts and against at
least such risks as are customarily insured against in
the same general area by companies engaged in the same or
similar business, which insurance shall in any event not
provide for materially less coverage than the insurance
in effect on the Closing Date.
8.06. Inspection of Property; Books and
Records; Discussions. (a) Such Borrower shall permit,
and shall cause each of its Subsidiaries to permit,
subject to applicable Requirements of Law concerning
classified information and to the rights of any tenants
or licensees of such Properties, any authorized
representative(s) designated by the Administrative Agent
and, after the occurrence and during the continuation of
an Event of Default set forth in Section 11.01(a), any
Lender, to visit and inspect any of the Properties of
such Person or such Subsidiary to examine, audit, check
and make copies of their respective financial and
accounting records, books, journals, orders, receipts and
any correspondence and other data relating to their
respective businesses or the transactions contemplated
hereby and by the Transaction Documents (including,
without limitation, in connection with environmental
compliance, hazard or liability), and to discuss their
affairs, finances and accounts with their officers and
independent certified public accountants, upon reasonable
notice given by the Administrative Agent to a Financial
Officer of such Borrower in writing and at reasonable
times during normal business hours, as often as may be
reasonably requested. All reasonable costs and expenses
incurred by the Administrative Agent as a result of such
inspection, audit or examination conducted pursuant to
this Section 8.06 shall be paid by the Company.
(b) Such Borrower shall keep and maintain, and
shall cause its Subsidiaries to keep and maintain, in all
material respects proper books of record and account in
which entries in conformity with GAAP shall be made of
all dealings and transactions in relation to their
respective businesses and activities, including, without
limitation, transactions and other dealings with respect
to the Collateral.
8.07. ERISA Compliance. Such Borrower shall,
and shall cause each of its Subsidiaries (to the extent
such Subsidiary is required by law) and ERISA Affiliates
to, establish, maintain and operate all Plans to comply
in all material respects with the provisions of ERISA,
the Internal Revenue Code, all other applicable laws and
the regulations and interpretations thereunder, and the
respective requirements of the governing documents for
such Plans.
8.08. Foreign Employee Benefit Plan
Compliance. Such Borrower shall, and shall cause each of
its Subsidiaries and ERISA Affiliates to, establish,
maintain and operate all Foreign Employee Benefit Plans
to comply in all material respects with all laws,
regulations and rules applicable thereto and the
respective requirements of the governing documents for
such Foreign Employee Benefit Plans.
8.09. Maintenance of Property. Such Borrower
shall cause all Property used or useful in the conduct of
its business or the business of any of its Subsidiaries
to be maintained and kept in good condition, repair and
working order (ordinary wear and tear and damage for
which casualty insurance is maintained excepted) and
supplied with all necessary equipment and shall cause to
be made all necessary repairs, renewals, replacements,
betterments and improvements thereof; provided, that
nothing in this Section 8.09 shall prevent such Borrower
or any of its Subsidiaries from discontinuing the
operation or maintenance of any of such Property if such
discontinuance is, in the judgment of such Borrower or
such Subsidiary, necessary or appropriate in the conduct
of its business or the business of any Subsidiary is
otherwise permitted by this Agreement and will not
materially impair the rights of the Administrative Agent,
the Lenders or the Issuing Banks hereunder or under the
other Loan Documents.
8.10. Subsidiary Guarantors; Future Liens on
Capital Stock. Upon written request of the
Administrative Agent, (a) such Borrower shall cause each
wholly owned Subsidiary (other than Salver, CDSR, Foreign
Sales Corp., Hexcel do Brasil Servicos S/C Ltda. and
Hexcel Alpha Corporation but including, without
limitation, (i) Hexcel Foundation, to the extent it
becomes a Subsidiary of such Borrower and applicable law
does not otherwise prohibit and (ii) Danutec Holdings
and/or Danutec Werkstoff, to the extent either Person
becomes a wholly owned Subsidiary of the Company), to
become a Subsidiary Guarantor pursuant to the terms of a
guaranty substantially in the form of the Foreign
Subsidiary Guaranties (provided, that Danutec Werkstoff
shall not guaranty any obligation whatsoever of Danutec
Holdings), (b) the Company shall provide to the U.S.
Administrative Agent a pledge of (i) all of the Capital
Stock of any Domestic Subsidiary (other than Hexcel Alpha
Corporation) held by the Company pursuant to a pledge
agreement substantially in the form of the Company Pledge
Agreement and (ii) all of the Capital Stock of any
Foreign Subsidiary (other than Hexcel Chemical Products
(U.K.) Limited, Foreign Sales Corp. and Hexcel do Brasil
Servicos S/C Ltda.) held by the Company (but in no event
greater than 65% of the outstanding Capital Stock of such
Foreign Subsidiary shall secure the Obligations of the
Company other than its Obligations under the Company
Guaranty, with 100% of such outstanding Capital Stock
securing its obligations under the Company Guaranty)
pursuant to a pledge agreement substantially in the form
of the Foreign Pledge Agreements, and (c) each Foreign
Borrower shall provide to the U.S. Administrative Agent a
pledge of all the Capital Stock of any of its
Subsidiaries (other than CML, except as required by
Section 8.11) held by it to secure such Foreign
Borrower's obligations pursuant to a pledge agreement
substantially in the form of the Foreign Pledge
Agreements to the U.S. Administrative Agent, in each
case, together with such other agreements, documents and
instruments that the Administrative Agent deems necessary
or desirable, it being understood that the granting of
the additional security for the Obligations pursuant to
this Section 8.10 is a material inducement to the
execution and delivery of this Agreement by each Lender.
8.11. CML Guaranty. CML shall, and the
Company and Hexcel U.K. shall cause CML to, execute and
deliver to the U.S. Administrative Agent a Foreign
Subsidiary Guaranty, substantially in the form of the
Foreign Subsidiary Guaranty executed and delivered by
Hexcel U.K. on the Closing Date, within two Business Days
after CML complies with the terms of sections 155 to 158
of the Companies Act; provided, that CML shall have
executed and delivered such Foreign Subsidiary Guaranty
no later than March 15, 1996.
8.12. Lodi Facility Guaranty. The Company
shall, within sixty (60) days after the Closing Date,
provide to the New Jersey Department of Environmental
Protection the self-guaranty required to be provided by
it by N.J. Stat. Ann. SECTION 13:1K-9(e) and 58:10B-3 in the
amount of $4,000,000 (or such other amount as is required
by the New Jersey Department of Environmental Protection)
in connection with the Company's former ownership of the
Lodi Facility.
8.13. Connecticut Opinion. In the event
the Company files with the SEC (or any other state,
federal or foreign Governmental Authority) any document,
information or other material that discloses that the
Company's chief executive office is located in the State
of Connecticut, the Company shall, within ten (10) days
of such filing, deliver to the U.S. Administrative Agent
an opinion of counsel from Connecticut counsel to the
Company substantially in the form of Exhibit M hereto.
8.14 Hexcel Technologies Pledge. The Company
shall use its best efforst to obtain consent from DIC to
the pledge by the Company to the U.S. Administration
Agent of the Shares of Hexcel Technologies owned by it
and, immediately upon receiving such consent from DIC,
the Company shall pledge to the U.S. Administrative Agent
the shares of Hexcel Technologies owned by the Company
pursuant to a pledge agreement substantially in the form
of the Company Pledge Agreement.
8.15 Replacement of Existing Standby Letters
of Credit. The Company shall use reasonable best efforts
to replace the standby letters of credit issued by
Citibank and listed on Schedule 2.04(k) with Standby
Letters of Credit to be Issued by the Issuing Bank within
30 days after the Closing Date.
ARTICLE IX
NEGATIVE COVENANTS
Each of the Borrowers covenants and agrees that
it shall comply with the following covenants as long as
any Commitment is outstanding and thereafter until
payment in full of all of the Obligations, unless (except
as otherwise provided below) the Requisite Lenders shall
otherwise give prior written consent thereto:
9.01. Indebtedness. None of the Company or
any of its Subsidiaries shall directly or indirectly
create, incur, assume or otherwise become or remain
directly or indirectly liable with respect to any
Indebtedness, except:
(i) the Obligations (including, without
limitation, Obligations arising pursuant to
Interest Rate Contracts or Currency Agreements
to which the Administrative Agent or an
Affiliate of the Administrative Agent is a
party);
(ii) Permitted Existing Indebtedness, and any
extensions, renewals, refundings or replacements of
Permitted Existing Indebtedness (other than the
Existing IRDBs); provided, that with respect to
Permitted Existing Indebtedness of the Company or
any of its Subsidiaries, any such extension,
renewal, refunding or replacement is in an aggregate
principal amount not greater than the principal
amount of, and is on terms no less favorable to the
Company or such Subsidiary than the terms of, the
Permitted Existing Indebtedness so extended,
renewed, refunded or replaced;
(iii) Indebtedness in respect of taxes,
assessments, governmental charges and claims
for labor, materials or supplies, to the extent
that payment thereof is not required pursuant
to Section 8.04;
(iv) Indebtedness constituting
Accommodation Obligations permitted by Section
9.05;
(v) in addition to the Indebtedness
permitted by clauses (i) through (iv) hereof
and clauses (vi) through (x) hereof and to the
extent permitted by Article X and in any event
in an aggregate outstanding principal amount
not to exceed $10,000,000 at any time, Capital
Leases and purchase money Indebtedness incurred
by the Company or any of its Subsidiaries to
finance the acquisition of tangible assets, and
Indebtedness incurred by the Company or any of
its Subsidiaries to refinance such Capital
Leases and purchase money Indebtedness;
(vi) Indebtedness under appeal bonds in
connection with judgments that do not result in
an Event of Default or Default;
(vii) Indebtedness arising from intercompany
loans permitted by Section 9.04(iv), (v) and (vi);
(viii) Permitted Subordinated Indebtedness;
(ix) in addition to the Indebtedness permitted
by clauses (i) through (viii) above,
(A) Indebtedness not in excess of the principal
amount of (y) the Dollar Equivalent of $10,000,000
in the aggregate at any time outstanding in
connection with loans made by the Company or its
Domestic Subsidiaries to any Foreign Borrower and
(z) $10,000,000 in the aggregate at any time
outstanding made by the Borrowers or a Borrower to
any wholly owned Subsidiary of the Company that is
not a Borrower hereunder; and (B) Indebtedness owing
by a Foreign Borrower to another Foreign Borrower or
by any Foreign Borrower or its Subsidiaries or any
Domestic Subsidiary to the Company;
(x) in addition to the Indebtedness permitted
by clauses (i) through (ix) above, Indebtedness not
in excess of an aggregate principal amount of
$10,000,000 at any time outstanding;
(xi) in addition to Indebtedness permitted by
clauses (i) through (x) above, Indebtedness incurred
by Hexcel Belgium not in excess of an aggregate
principal amount of $12,000,000 at any time
outstanding; and
(xii) Foreign Currency Protection Agreements
entered into by the Company or any Subsidiary in the
ordinary course of business.
9.02. Sales of Assets. None of the Company or
any of its Subsidiaries shall sell, assign, transfer,
lease, convey or otherwise dispose of any Property,
whether now owned or hereafter acquired, or any income or
profits therefrom, or enter into any agreement to do so,
except:
(i) the sale of Inventory in the ordinary
course of business;
(ii) sales of assets outside of the ordinary
course of business not in excess of $10,000,000 in
any Fiscal Year;
(iii) in addition to dispositions permitted
by clauses (i) and (ii) of this Section 9.02,
the disposition of Equipment if such Equipment
is obsolete or no longer useful in the ordinary
course of the Company's or such Subsidiary's
business or otherwise is not required to be
maintained by the Company or such Subsidiary
pursuant to Section 8.09;
(iv) assignments and licenses of intellectual
property of the Company and its Subsidiaries in the
ordinary course of business or pursuant to the
Strategic Alliance Agreement;
(v) leases of owned Real Property and
subleases of leased Real Property, to the extent
such leases and subleases have anticipated annual
rentals of less than $1,000,000 each;
(vi) the transfer by Hexcel Technologies, Inc.
to DIC Technologies, Inc. of up to 15% of the
outstanding partnership interests in HDP in
connection with the Investments permitted by Section
9.04(v);
(vii) the Company may sell the Properties
constituting the businesses described on Schedule
9.02; provided, that (A) the Administrative Agent
shall have received the documentation evidencing
such sales, (B) such sales shall not be made for
less than the Fair Market Value of such Properties
and for consideration other than at least 85% cash
and (C) the Net Cash Proceeds arising from such
sales shall not be substantially less than the
amount specified with respect to such Property on
Schedule 9.02;
(viii) sales permitted by Sections 9.08, 9.10(a)
and 9.13; and
(ix) the Company may sell the Specified
Equipment to Ciba-Geigy or any Affiliate of Ciba-
Geigy pursuant to the Manufacturing and Supply
Agreement.
9.03. Liens. None of the Company or any of
its Subsidiaries shall directly or indirectly create,
incur, assume or permit to exist any Lien on or with
respect to any of their respective Properties or assets
except:
(i) Liens created by the Loan Documents;
(ii) Permitted Existing Liens and future
Liens securing any extensions, renewals,
refundings or replacements of Permitted
Existing Indebtedness to the extent permitted
by Section 9.01(ii), but only if such future
Lien attaches to the same Property and secures
only such permitted extensions, renewals,
refundings and replacements;
(iii) Customary Permitted Liens;
(iv) purchase money Liens granted by any
of the Borrowers (including the interest of a
lessor under a Capital Lease) and Liens to
which any Property is subject at the time of a
Borrower's acquisition thereof securing
Indebtedness permitted by Section 9.01(v) and
limited in each case to the property purchased
or subject to such lease;
(v) any attachment or judgment Lien the
existence of which does not constitute an Event of
Default under Section 11.01(h); and
(vi) Liens relating to raw materials supplied
by Ciba-Geigy to the Company pursuant to the
Manufacturing and Supply Agreement, and Liens
relating to the Company's inventory of raw materials
and finished products which are required to be
purchased by Ciba-Geigy pursuant to the
Manufacturing and Supply Agreement upon termination
thereof.
9.04. Investments. None of the Company or any
of its Subsidiaries shall directly or indirectly make or
own any Investment or make any contribution except:
(i) Investments in cash and Cash Equivalents;
(ii) Permitted Existing Investments as of the
Closing Date;
(iii) Investments received in connection
with the bankruptcy or reorganization of
suppliers and customers and in settlement of
delinquent obligations of, and other disputes
with, customers and suppliers arising in the
ordinary course of business;
(iv) cash Investments arising from intercompany
loans made by the Company to any Existing Joint
Venture (other than DIC), not to exceed $5,000,000
in the aggregate at any time outstanding; provided,
that no such Investment under this clause (iv) may
be made as long as any Default or Event of Default
has occurred and is continuing or would occur as a
result of such Investment;
(v) (A) cash Investments made by the Company
in Hexcel Technologies, Inc. or HDP, solely for the
purpose of making Investments in or for the benefit of
DIC and (B) cash Investments by Hexcel Technologies, Inc.
in DIC, which Investments may result in a reduction in
the ownership by Hexcel Technologies, Inc. in HDP from
50% of the outstanding partnership interests to 35% of
such partnership interests and shall not exceed
$2,000,000 in Fiscal Year 1996 and $4,500,000 in the
aggregate in Fiscal Year 1997 and thereafter, less any
payments made by the Company to Dainippon Ink &
Chemicals, Inc. permitted pursuant to Section 9.05(vii);
provided, that if the maximum amount permitted for any
Fiscal Year exceeds the amount of such Investments for
such Fiscal Year, then such Investments made by the
Company and Hexcel Technologies, Inc. for the immediately
succeeding Fiscal Year may exceed the maximum amount set
forth above with respect to such succeeding Fiscal Year
by the amount of such excess from the immediately
preceding Fiscal Year (such excess amount being treated
as the last amount invested in such succeeding Fiscal
Year), but in no event shall the amount of such
Investments exceed $6,500,000 in the aggregate at any
time; and provided, further, that no such Investment
under subclause (A) of this clause (v) may be made as
long as any Default or Event of Default has occurred and
is continuing or would occur as a result of such
Investment;
(vi) Investments in intercompany loans or
equity Investments (A) permitted by Section 9.01(ix)
and (B) other than as set forth in Subclause (A) of
this clause (vi), made in connection with the
Acquisition in amounts not to exceed the amounts set
forth on Schedule 9.04;
(vii) Investments in partnerships and joint
ventures (other than the Existing Joint Venture)
which Investments shall not cause the Maximum
Partnership/Joint Venture Investment Amount to
exceed $5,000,000 at any time; provided, that no
such Investment under this clause (vii) may be made
as long as any Default or Event of Default has
occurred and is continuing or would occur as a
result of such Investment;
(viii) Investments in cash deposits with
financial institutions for payroll accounts and
other deposit accounts in the ordinary course of
business not to exceed $10,000,000 in the aggregate
at any one time outstanding; provided, that there
shall be no limit on the amount of such deposits at
Citibank;
(ix) cash contributions to Hexcel
Foundation not to exceed $200,000 in the aggregate
in any Fiscal Year; provided, that the unused
portion of such amount may be used in the next
succeeding year;
(x) cash Investments not otherwise permitted
hereby not to exceed $1,000,000 in the aggregate at
any one time outstanding;
(xi) Investments specifically contemplated by
the Transaction Documents;
(xii) Cash Collateral invested pursuant to the
Loan Documents;
(xiii) promissory notes and other Investments
permitted by Section 9.02(vii); and
(xiv) Investments relating to Environmental
Claims at the Lodi Facility permitted by Section
9.05(ix).
9.05. Accommodation Obligations. None of the
Company or any of its Subsidiaries shall directly or
indirectly create or become or be liable with respect to
any Accommodation Obligation, except:
(i) Permitted Existing Accommodation
Obligations;
(ii) Accommodation Obligations arising
under the Loan Documents;
(iii) obligations, warranties and indemnities,
not with respect to Indebtedness of any Person, that
have been or are undertaken or made in the ordinary
course of business or in connection with the sale of
assets permitted by Section 9.02(vii) and not for
the benefit of or in favor of an Affiliate of the
Company or any of its Subsidiaries;
(iv) Accommodation Obligations of any
Subsidiary in respect of obligations of the Company;
(v) Accommodation Obligations of any
partnership or joint venture (other than the
Existing Joint Ventures) as long as the incurrence
of such obligations shall not cause the Maximum
Partnership/Joint Venture Investment Amount to
exceed $5,000,000 at any time; provided, that no
such Investment under this clause (v) may be made as
long as any Default or Event of Default has occurred
and is continuing or would occur as a result of such
Investment;
(vi) Accommodation Obligations with respect to
obligations, warranties and indemnities (other than
with respect to Indebtedness) (A) in the ordinary
course of business, (B) arising under the Ciba-Geigy
Transaction Documents and (C) with respect to
customary representations, warranties and
indemnities entered into in connection with the sale
or other disposition of assets;
(vii) Accommodation Obligations in respect of
payments made by the Company in Fiscal Year 1997 and
thereafter to Dainippon Ink & Chemical, Inc. in an
aggregate amount not to exceed $4,500,000;
(viii) subordination of certain amounts payable
to the Company by Knytex as provided for in the
Knytex Credit Facility; and
(ix) Accommodation Obligations in connection
with Environmental Claims at the Lodi Facility not
to exceed $5,000,000 in the aggregate.
9.06. Restricted Junior Payments. Subject to
Section 9.16, none of the Company or any of its
Subsidiaries shall declare or make any Restricted Junior
Payment, except:
(i) dividends or other distributions made to
the Company or any of its Subsidiaries by any
Subsidiary of the Company;
(ii) regularly scheduled payments on the
Subordinated Debentures, but only if such payments
are permitted to be made under the terms of the
Subordinated Debenture Indenture;
(iii) regularly scheduled payments on the
Subordinated Notes, but only if such payments are
permitted to be made under the terms of the
Subordinated Notes Indenture, and one or more
voluntary prepayments of the Subordinated Notes, as
long as the principal amount of such prepayments
does not exceed in the aggregate the lesser of (A)
the cash and Cash Equivalents on the balance sheet
of the Acquired Businesses on the Closing Date (or,
in the case of Danutec Holdings and Danutec
Werkstoff, on the Danutec Holdings Effective Date
and the Danutec Werkstoff Effective Date,
respectively), and (B) $6,000,000;
(iv) payments with respect to employee or
director stock options, stock incentive plans or
restricted stock plans of the Company;
(v) payment of the Hexcel Lyon Subordinated
Note; and
(vi) payments of Indebtedness made in
connection with the Acquisition as permitted by the
Ciba-Geigy Transaction Documents or as set forth on
Schedule 9.04.
9.07. Conduct of Business. None of the
Company or any of its Subsidiaries shall engage in any
business (pursuant to an Existing Joint Venture or
otherwise) other than the businesses engaged in by the
Company or such Subsidiaries on the Closing Date (after
giving effect to the Acquisition) and any business or
activities that are substantially similar, related or
incidental thereto.
9.08. Transactions with Affiliates. The
Company shall not, and shall not permit any of its
Subsidiaries to, except as otherwise expressly permitted
herein or as expressly contemplated by the Ciba-Geigy
Transaction Documents or contemplated by the Acquisition,
enter into any transaction with an Affiliate, other than
in the ordinary course of business, unless the terms of
such transaction are no less favorable to the Company or
such Subsidiary than those that would have been obtained
in a comparable transaction by the Company or such
Subsidiary with an unrelated person; provided, that the
foregoing shall not be deemed to prohibit (i) existing
employment or compensation agreements or other
arrangements with officers or directors of the Company or
any of its Subsidiaries, (ii) existing management
agreements, (iii) stock options and awards granted to
employees and directors of the Company or any of its
Subsidiaries under existing Plans or other employee
benefit Plans, and (iv) any contract or transaction
providing for indemnification of officers or directors of
the Company or any of its Subsidiaries from liability, or
providing or maintaining insurance or other arrangements
on behalf of any such officer or director against any
liability asserted against such person and incurred in or
arising out of such capacity, (v) the subrogation
agreement and related agreements entered into or to be
entered into by the Company in connection with the Knytex
Credit Facility and (vi) the transactions set forth on
Schedule 9.08 or permitted by Section 9.09.
9.09. Restriction on Fundamental Changes.
None of the Company or any of its Subsidiaries shall (i)
enter into any merger or consolidation, or liquidate,
wind-up or dissolve (or suffer any liquidation or
dissolution), except for a merger or consolidation of any
wholly owned Subsidiary (other than a Borrower) into the
Company or another wholly owned Subsidiary (with the
Company or such other Subsidiary as the surviving
corporation); provided, that (A) Danutec Holdings may
merge with or into Danutec Werkstoff, and (B) Brochier
and/or CDSR may merge with or into Hexcel Lyon; and
provided, further, that after giving effect to any such
merger or consolidation, no Default or Event of Default
shall have occurred or be continuing, or (ii) enter into
or permit any transaction or series of transactions in
which the Company and/or any of its Subsidiaries acquires
all or substantially all of the Capital Stock and/or
assets of another Person or business or division of
another Person other than (x) the assets, business or
division of a wholly owned Subsidiary or (y) the
Acquisition.
9.10. Sales and Leasebacks; Operating Leases.
(a) None of the Company or any of its Subsidiaries shall
enter into any Sale and Leaseback Transaction other than
a Sale and Leaseback Transaction on terms and conditions
satisfactory to the Administrative Agent relating to the
sale and lease of Equipment where, after giving effect to
such Sale and Leaseback Transaction, the aggregate Fair
Market Value of all such Equipment sold does not exceed
$10,000,000.
(b) None of the Company or any of its
Subsidiaries shall become liable in any way, whether
directly or by assignment or by Accommodation Obligation,
for the obligations of a lessee under any Operating Lease
unless, immediately after giving effect to the incurrence
of liability with respect to such Operating Lease, the
aggregate amount of all rents paid or accrued under all
Operating Leases of the Company and its Subsidiaries as
lessee (net of sublease income and determined in
conformity with GAAP) shall not exceed $7,000,000 in any
Fiscal Year.
9.11. Margin Regulations; Securities Laws.
None of the Company or any of its Subsidiaries shall use
all or any portion of the proceeds of any credit extended
hereunder to purchase or carry Margin Stock.
9.12. ERISA and Certain Employment Matters. To
the extent the following actions, individually or in the
aggregate, would subject or would be reasonably likely to
subject the Company or any ERISA Affiliate to a liability
in excess of $1,000,000, the Company shall not:
(i) engage, or permit any ERISA Affiliate to
engage, in any prohibited transaction described in
Sections 406 of ERISA or 4975 of the Internal
Revenue Code for which a statutory or class
exemption is not available or a private exemption
has not been obtained from the DOL;
(ii) permit to exist any accumulated funding
deficiency (as defined in sections 302 of ERISA and
412 of the Internal Revenue Code) with respect to
any Benefit Plan, whether or not waived;
(iii) fail, or permit any ERISA Affiliate to
fail, to pay timely required contributions or annual
installments due with respect to any waived funding
deficiency to any Benefit Plan;
(iv) terminate, or permit any ERISA Affiliate
to terminate, any Benefit Plan that would result in
a material liability of the Company or any ERISA
Affiliate under Title IV of ERISA;
(v) fail to make any contribution or payment
to any Multiemployer Plan that the Company or any
ERISA Affiliate may be required to make under any
agreement relating to such Multiemployer Plan, or
any law pertaining thereto;
(vi) fail, or permit any ERISA Affiliate to
fail, to pay any required installment or any other
payment required under Section 412 of the Internal
Revenue Code on or before the due date for such
installment or other payment;
(vii) amend, or permit any ERISA Affiliate to
amend, a Plan resulting in an increase in current
liability for the plan year such that the Company or
any ERISA Affiliate is required to provide security
to such Plan under Section 401(a)(29) of the
Internal Revenue Code;
(viii) permit any unfunded liabilities with
respect to any Foreign Pension Plan other than as
permitted by local law;
(ix) fail, or permit any Subsidiary or ERISA
Affiliate to fail, to pay any required contributions
or payments to a Foreign Pension Plan on or before
the due date for such required installment or
payment; or
(x) consent to an employee's election under an
Executive Deferred Compensation and Consulting
Agreement between such employee and the Company to
pay benefits thereunder in the form of a lump sum or
in installments over a period of less than five
years.
9.13. Issuance or Sale of Capital Stock. To
the maximum extent permitted by applicable law, none of
the Company or any of its Subsidiaries shall (i) grant
any rights (either preemptive or others) to subscribe for
or to purchase, or any option for the purchase of, its
Capital Stock or (ii) create calls, commitments or claims
of any character relating to any of its Capital Stock, in
each case, other than grants and issuances pursuant to
the management incentive plans listed on Schedule 9.13
hereto (as amended from time to time), pursuant to the
Governance Agreement, as set forth in Schedule 9.04 or as
required by applicable law. to the maximum extent
permitted by applicable law, the Company shall not sell
or otherwise dispose of, or permit the sale or
disposition of, any shares of Capital Stock of any of its
Subsidiaries except (x) as required by applicable law for
the qualification of directors or to satisfy minimum
shareholder requirements under applicable law or (y) as
permitted by Section 9.09.
9.14. Constituent Documents. None of the
Company or any of its Subsidiaries shall materially
amend, modify or otherwise change any of the terms or
provisions in any of their respective Constituent
Documents as in effect on the Closing Date, except for
amendments, modifications or changes to the Constituent
Documents of (a) Hexcel U.K., solely for the purpose of
changing its corporate structure to become an unlimited
liability company and (b) of Danutec Holdings, solely for
the purpose of changing its corporate structure to become
an Aktiengesellschaft.
9.15. Fiscal Year. None of the Company or any
of its Subsidiaries shall change its Fiscal Year for
accounting or tax purposes from a period consisting of
the four fiscal quarter period ending on December 31 of
each calendar year.
9.16. Cancellation of Debt; Prepayment;
Certain Amendments. None of the Company or any of its
Subsidiaries shall (i) cancel any material claim or debt
or amend or modify the terms thereof, except in the
ordinary course of its business or as disclosed on
Schedule 1.01.4 or 9.04, or (ii) prepay, redeem,
purchase, repurchase, defease or retire any long-term
Indebtedness, other than (A) the Obligations, (B)
Indebtedness in respect of the Existing Facility, (C) the
Existing IRDBs (or any related Accommodation Obligation),
(D) any intercompany Indebtedness permitted by Section
9.01 if an Event of Default is not existing and would not
result from giving effect to such prepayment, (E) as
permitted by Section 9.06, (F) voluntary prepayments of
the Subordinated Notes permitted pursuant to Section
9.06(iii) and (G) other scheduled payments in respect of
long-term Indebtedness, or (iii) amend, supplement or
otherwise modify the terms of any Transaction Documents,
the Subordinated Debentures or the Subordinated Debenture
Indenture in any material respect, other than amendments
to non-material Transaction Documents in a manner not
materially adverse to the Lenders.
9.17. Environmental Matters. None of the
Company or any of its Subsidiaries shall:
(i) become subject to any Liabilities and
Costs that would have a Material Adverse Effect arising
out of or related to (a) the Release or threatened
Release at any location of any Contaminant into the
environment, or any Remedial Action in response thereto,
or (b) any violation of any Environmental, Health and
Safety Requirements of Law; or
(ii) either directly or indirectly, create,
incur, assume or permit to exist any Environmental Lien
on or with respect to any of its Property other than
Permitted Existing Liens.
9.18. Accounting Changes. The Company shall
not make, or permit any of its Subsidiaries to make, any
material change in accounting treatment and reporting
practices or tax reporting treatment, except as required
by GAAP or law and disclosed to the Lenders and the
Administrative Agent or as permitted by the Loan
Documents.
9.19. No New Restrictions on Subsidiary
Dividends. Except as may be required by any applicable
Requirements of Law or pursuant to the Loan Documents or
the Subordinated Notes Indenture, the Company will not
agree, or permit any of its Subsidiaries to agree, to
create or otherwise permit to become effective any
consensual encumbrance or restriction of any kind on the
ability of any Subsidiary to (i) pay, directly or
indirectly, dividends or make any other distributions in
respect of its Capital Stock, (ii) make any other
distribution or transfer of funds or assets to the
Company or (iii) make loans or advances to or other
Investments in, or pay any Indebtedness or other
obligation owing to, the Company.
ARTICLE X
FINANCIAL COVENANTS
Each of the Borrowers covenants and agrees that
as long as any Commitment is outstanding and thereafter
until payment in full of all of the Obligations, unless
the Requisite Lenders shall otherwise give prior written
consent thereto:
10.01. Minimum Tangible Net Worth. The
Tangible Net Worth of the Company and its Subsidiaries as
determined on the last day of each fiscal quarter
commencing on March 31, 1996 and ending on the Revolving
Credit Termination Date for the fiscal quarter period
ending on such date shall not be less than the sum of (i)
$60,000,000 plus (ii) the sum of (A) solely to the extent
that the result of such calculation is a positive number,
fifty percent (50%) of the cumulative Net Income of the
Company and its Subsidiaries on a consolidated basis for
each fiscal quarter ending after the Closing Date
(without deduction for any net losses for any fiscal
quarter) and (B) one hundred percent (100%) of the Net
Cash Proceeds from the issuance by the Company of any
Capital Stock.
10.02. Minimum Fixed Charge Coverage Ratio.
The Fixed Charge Coverage Ratio of the Company and its
Subsidiaries on a combined basis, as determined as of the
last day of each fiscal quarter of the Company set forth
below for the four fiscal quarter period ending on such
date (it being understood and agreed that the Fixed
Charge Coverage Ratio for the fiscal quarters ending in
1995 and on March 31, 1996 (for the period from January
1, 1996 through the Closing Date) shall be determined on
a pro forma basis based on the combined performance of
(A) the Company and its Subsidiaries prior to the
Acquisition and (B) the Acquired Businesses), shall not
be less than the minimum ratio set forth opposite such
fiscal quarter:
Fiscal Quarter Minimum Ratio
First fiscal quarter of 1996 1.25 to 1.0
Second fiscal quarter of 1996 1.25 to 1.0
Third fiscal quarter of 1996 1.10 to 1.0
Fourth fiscal quarter of 1996 1.50 to 1.0
First fiscal quarter of 1997 1.75 to 1.0
Second fiscal quarter of 1997 2.25 to 1.0
Third fiscal quarter of 1997 2.50 to 1.0
Fourth fiscal quarter of 1997 2.75 to 1.0
First fiscal quarter of 1998 2.75 to 1.0
Second fiscal quarter of 1998 3.00 to 1.0
Third fiscal quarter of 1998 3.25 to 1.0
and each fiscal quarter
ending thereafter
10.03. Maximum Leverage Ratio. The Leverage
Ratio of the Company and its Subsidiaries on a combined
basis, as determined as of the last day of each fiscal
quarter of the Company set forth below for the four
fiscal quarter period ending on such date (it being
understood and agreed that the Leverage Ratio for the
fiscal quarters ending in 1995 and on March 31, 1996 (for
the period from January 1, 1996 through the Closing Date)
shall be determined on a pro forma basis based on the
combined performance of (A) the Company and its
Subsidiaries prior to the Acquisition and (B) the
Acquired Businesses), shall not be greater than the
maximum ratio set forth opposite such fiscal quarter:
Fiscal Quarter Maximum Ratio
First fiscal quarter of 1996 4.50 to 1.0
Second fiscal quarter of 1996 4.50 to 1.0
Third fiscal quarter of 1996 4.50 to 1.0
Fourth fiscal quarter of 1996 4.25 to 1.0
First fiscal quarter of 1997 4.00 to 1.0
Second fiscal quarter of 1997 3.75 to 1.0
Third fiscal quarter of 1997 3.50 to 1.0
Fourth fiscal quarter of 1997 3.50 to 1.0
First fiscal quarter of 1998 3.25 to 1.0
Second fiscal quarter of 1998 3.00 to 1.0
Third fiscal quarter of 1998 2.75 to 1.0
and each fiscal quarter
ending thereafter
ARTICLE XI
EVENTS OF DEFAULT; RIGHTS AND REMEDIES
11.01. Events of Default. Each of the
following occurrences shall constitute an Event of
Default hereunder:
(a) Failure to Make Payments When Due. Any
Borrower shall fail to pay (i) when due any principal on
the Loans (including the Reimbursement Obligations), (ii)
when due any interest on the Loans (including the
Reimbursement Obligations) and such non-payment continues
for a period of two (2) Business Days after the due date
thereof, or (iii) any other Obligation, and if such non-
payment relates to Obligations other than interest or
principal, such non-payment continues for a period of
five (5) Business Days after the due date thereof.
(b) Breach of Certain Covenants. Any Borrower
or any of the Subsidiary Guarantors shall fail to perform
or observe duly and punctually any agreement, covenant or
obligation binding on such Person under (i) Sections
7.02, 7.03, 7.04, 8.01, 8.02, 8.06 or 8.11, or
(ii) Article IX or Article X.
(c) Breach of Representation or Warranty. Any
representation or warranty made or deemed made by the
Company or any of its Subsidiaries to the Administrative
Agent, any Lender or any Issuing Bank herein or in any
other Loan Document or in any statement or certificate at
any time given by any such Person pursuant to any Loan
Document shall be false or misleading in any material
respect on the date made (or deemed made).
(d) Other Defaults. Any Borrower shall
default in the performance of or compliance with any term
contained herein (other than those referred to in
paragraphs (a), (b) or (c) of this Section 11.01), or the
Company or any of its Subsidiaries shall default in the
performance of or compliance with any term contained in
any other Loan Document, and such default shall continue
for (i) ten (10) Business Days after the occurrence
thereof with respect to any term contained in Sections
7.01, 7.05, 7.06, 7.07 and 8.07; and (ii) thirty (30)
days after the occurrence thereof with respect to any
other term.
(e) Default as to Other Indebtedness;
Operating Leases. The Company or any of its Subsidiaries
shall fail to make any payment when due (whether by
scheduled maturity, required prepayment, acceleration,
demand or otherwise) with respect to Permitted
Subordinated Indebtedness or any other Indebtedness
(other than an Obligation) in excess of $3,000,000 and
such default shall be continuing; or any breach, default
or event of default, or any other condition shall exist
under any instrument, agreement or indenture pertaining
to any other Indebtedness (other than an Obligation) in
excess of $3,000,000, if the effect thereof is (or, with
the giving of notice or lapse of time or both, would be)
to cause an acceleration, mandatory redemption or other
required repurchase of such Indebtedness, or permit the
holders of such Indebtedness to accelerate the maturity
of such Indebtedness or require the redemption or other
repurchase of such Indebtedness; or any such Indebtedness
shall be otherwise declared to be due and payable (by
acceleration or otherwise) or required to be prepaid,
redeemed or otherwise repurchased by the Company or any
of its Subsidiaries (other than by a regularly scheduled
required prepayment, mandatory redemption or required
repurchase) prior to the stated maturity thereof; or any
breach, default or event of default remaining uncured for
a period of sixty (60) days on the part of the Company or
any of its Subsidiaries shall occur under any Operating
Lease to which the Company or any of its Subsidiaries is
a party pursuant to which rental payments thereunder
equal or exceed $3,000,000 per annum.
(f) Involuntary Bankruptcy; Appointment of
Receiver, Etc.
(i) An involuntary case shall be commenced
against the Company or any of its Subsidiaries and the
petition shall not be dismissed, stayed, bonded or
discharged within sixty (60) days after commencement of
the case; or a court having jurisdiction in the premises
shall enter a decree or order for relief in respect of
the Company or any of its Subsidiaries in an involuntary
case, under any applicable bankruptcy, insolvency or
other similar law now or hereinafter in effect; or any
other similar relief shall be granted under any
applicable federal, state, local or foreign law.
(ii) A decree or order of a court having
jurisdiction in the premises for the appointment of a
receiver, liquidator, sequestrator, trustee, custodian or
other officer having similar powers over the Company or
any of its Subsidiaries or over all or a substantial part
of the Property of the Company or any of its Subsidiaries
shall be entered; or an interim receiver, trustee or
other custodian of the Company or any of its Subsidiaries
or of all or a substantial part of the property of the
Company or any of its Subsidiaries shall be appointed, or
a warrant of attachment, execution or similar process
against any substantial part of the Property of the
Company or any of its Subsidiaries shall be issued and
any such event shall not be stayed, dismissed, bonded or
discharged within sixty (60) days after entry,
appointment or issuance.
(g) Voluntary Bankruptcy; Appointment of
Receiver, Etc. The Company or any of its Subsidiaries
shall commence a voluntary case under any applicable
bankruptcy, insolvency or other similar law now or
hereafter in effect, or shall consent to the entry of an
order for relief in an involuntary case, or to the
conversion of an involuntary case to a voluntary case,
under any such law, or shall consent to the appointment
of or taking possession by a receiver, trustee or other
custodian for all or a substantial part of its property;
or the Company or any of its Subsidiaries shall make any
assignment for the benefit of creditors.
(h) Judgments. Any judgment, writ, order or
warrant of attachment, or other similar process shall be
rendered against the Company or any of its Subsidiaries
or any of their respective assets involving in any single
case or in the aggregate an amount in excess of
$3,000,000 (in excess of applicable insurance coverage)
is entered and remains undischarged, unvacated and
unstayed for a period of sixty (60) days.
(i) Dissolution. Any order, judgment or
decree shall be entered against the Company or any of its
Subsidiaries decreeing its involuntary dissolution or
other similar proceeding, and such order shall remain
undischarged and unstayed for a period in excess of sixty
(60) days; or the Company or any of its Subsidiaries
shall otherwise dissolve or cease to exist except as
specifically permitted hereby.
(j) Loan Documents; Failure of Security. At
any time, for any reason, (i) any Loan Document ceases to
be in full force and effect (other than in accordance
with its terms) or the Company or any of its Subsidiaries
party thereto seeks to repudiate its obligations
thereunder and the Liens intended to be created thereby
are, or the Company or any such Subsidiary seeks to
render such Liens, invalid or unperfected, or (ii) the
Liens in favor of the U.S. Administrative Agent, the
Issuing Banks and/or the Lenders contemplated by the Loan
Documents shall, at any time, be invalidated or otherwise
cease to be in full force and effect, or such Liens shall
be subordinated or shall not have the priority
contemplated hereby or by the other Loan Documents,
except, in each case, to the extent such failure,
cessation or subordination is (A) in accordance with the
terms of the Loan Documents or (B) a result of (x) the
failure of the U.S. Administrative Agent to maintain
possession of the Securities representing the Collateral
or (y) the gross negligence or willful misconduct of any
of the Administrative Agent, the Issuing Banks, the
Syndication Agent or the Lenders.
(k) Termination Event. Any Termination Event
occurs that the Administrative Agent reasonably believes
could subject either the Company or any ERISA Affiliate
to a liability in excess of $3,000,000.
(l) Waiver of Minimum Funding Standard. The
plan administrator of any Plan applies under Section
412(d) of the Internal Revenue Code for a waiver of the
minimum funding standards of Section 412(a) of the
Internal Revenue Code and the Administrative Agent
believes the substantial business hardship upon which the
application for the waiver is based could reasonably be
likely to have a Material Adverse Effect.
(m) Material Adverse Change. An event shall
exist or occur that has a material adverse effect upon
(i) the business, condition (financial or otherwise),
operations, performance, properties or prospects of the
Company and its Subsidiaries, taken as a whole, (ii) the
ability of the Borrowers and the Subsidiary Guarantors,
taken as a whole, to perform their obligations under the
Loan Documents or (iii) the ability of the Lenders, the
Issuing Banks or the Administrative Agent to enforce the
Loan Documents.
(n) Change of Control. A Change of Control
shall have occurred.
(o) Subordinated Notes. (A) Prior to the first
to occur of (i) March 1, 1999, (ii) the payment in full
of all Obligations and the termination of all Commitments
and (iii) the extension of the Revolving Credit
Termination Date without the consent of Ciba-Geigy, or
(B) at any time when any Event of Default in Section
11.01(a) shall have occurred and be continuing, Ciba-
Geigy shall cease to hold directly or indirectly (through
one or more wholly owned Subsidiaries) one hundred
percent (100%) of the outstanding principal amount of the
Subordinated Notes; provided, that if a wholly owned
Subsidiary of Ciba-Geigy Limited becomes a holder of all
or any portion of the Subordinated Notes, it shall not
constitute an Event of Default under this Section
11.01(o) in the event that Ciba-Geigy Limited effects a
Broad Distribution (as defined in the Governance
Agreement) of up to 20% of the Capital Stock of such
wholly owned Subsidiary, but only if (1) such
distribution has a bona fide business purpose (other than
the sale or distribution of Subordinated Notes) and (2)
the Subordinated Notes "beneficially owned" (as defined
in Rule 13d-3 under the Exchange Act) by such Subsidiary
do not constitute a material portion of the total assets
of such Subsidiary.
(p) Voting Stock of the Company. Ciba-Geigy
Limited shall cease to "beneficially own" (as defined in
Rules 13d-3 and 13d-5 under the Exchange Act), directly
or indirectly, at least forty percent (40%) of the Voting
Stock of the Company.
An Event of Default shall be deemed "continuing" until
cured or waived in accordance with Section 13.07.
11.02. Rights and Remedies.
(a) Acceleration and Termination. Upon the
occurrence of any Event of Default described in Sections
11.01(f) or 11.01(g) as applied to any Borrower, the
Commitments shall automatically and immediately terminate
and the unpaid principal amount of, and any and all
accrued interest on, the Obligations and all accrued fees
shall automatically become immediately due and payable,
without presentment, demand or protest, or other
requirements of any kind (including, without limitation,
valuation and appraisement, diligence, presentment,
notice of intent to demand or accelerate and of
acceleration), all of which are hereby expressly waived
by each of the Borrowers; and upon the occurrence and
during the continuance of any other Event of Default
(including any Event of Default described in Sections
11.01(f) or 11.01(g) as applied to any Subsidiary of any
Borrower that is not itself a Borrower), the
Administrative Agent shall at the request, or may with
the consent, of the Requisite Lenders, by written notice
to the Company, (i) declare that all or any portion of
the Commitments are terminated, whereupon the Commitments
and the obligation of each Lender to make any Loan
hereunder and of each Lender or Issuing Bank to Issue or
participate in any Letter of Credit not then Issued shall
immediately terminate, and/or (ii) declare the unpaid
principal amount of and any and all accrued and unpaid
interest on the Obligations to be, and the same shall
thereupon be, immediately due and payable, without
presentment, demand, or protest or other requirements of
any kind (including, without limitation, valuation and
appraisement, diligence, presentment, notice of intent to
demand or accelerate and of acceleration), all of which
are hereby expressly waived by each of the Borrowers.
(b) Deposit for Letters of Credit. In
addition, after the occurrence and during the continuance
of an Event of Default set forth in Section 11.01(a), the
Borrowers shall, promptly upon demand by the
Administrative Agent (given upon the written instructions
of the Requisite Lenders or, in the absence of such
instructions, in its sole discretion), to the extent
permitted by applicable law, deliver to the
Administrative Agent Cash Collateral in such form as
requested by the Administrative Agent, together with such
endorsements, and execution and delivery of such
documents and instruments as the Administrative Agent may
request in order to perfect or protect the Administrative
Agent's Lien with respect thereto, in an aggregate
principal amount equal to the then outstanding Letter of
Credit Obligations.
(c) Rescission. If at any time after
termination of the Commitments and/or acceleration of the
maturity of the Loans, the Borrowers shall pay all
arrears of interest and all payments on account of
principal of the Loans and Reimbursement Obligations that
shall have become due otherwise than by acceleration
(with interest on principal and, to the extent permitted
by law, on overdue interest, at the rates specified
herein) and all Events of Default and Defaults (other
than nonpayment of principal of and accrued interest on
the Loans due and payable solely by virtue of
acceleration) shall be remedied or waived pursuant to
Section 13.07, then upon the written consent of the
Requisite Lenders and written notice to the Company, the
termination of the Commitments and/or the acceleration
and the consequences of such termination and/or
acceleration may be rescinded and annulled; but such
action shall not affect any subsequent Event of Default
or Default or impair any right or remedy consequent
thereon. The provisions of the preceding sentence are
intended merely to bind the Lenders and the Issuing Banks
to a decision that may be made at the election of the
Requisite Lenders; they are not intended to benefit the
Borrowers and do not give any of the Borrowers the right
to require the Lenders to rescind or annul any
acceleration hereunder, even if the conditions set forth
herein are met.
(d) Enforcement. Each of the Borrowers
acknowledges that in the event the Company or any of its
Subsidiaries fails to perform, observe or discharge any
of its respective obligations or liabilities hereunder or
under any other Loan Document, any remedy of law may
prove to be inadequate relief to the Administrative
Agent, the Syndication Agent, the Issuing Banks and the
Lenders; therefore, each of the Borrowers agrees that the
Administrative Agent, the Syndication Agent, the Issuing
Banks and the Lenders shall be entitled after the
occurrence and during the continuance of an Event of
Default to temporary and permanent injunctive relief in
any such case without the necessity of proving actual
damages.
ARTICLE XII
THE ADMINISTRATIVE AGENT; SYNDICATION AGENT
12.01. Appointment. (a) Each Lender and each
Issuing Bank hereby designates and appoints (i) Citibank
New York as the U.S. Administrative Agent hereunder, (ii)
Citibank International as the European Administrative
Agent hereunder and (iii) Credit Suisse as the
Syndication Agent hereunder (collectively, the "Agents"),
and each Lender and each Issuing Bank hereby irrevocably
authorizes the Administrative Agent to execute such
documents (including, without limitation, the Loan
Documents to which the Administrative Agent is a party)
and irrevocably authorizes the Agents to take such other
action on such Person's behalf under the provisions
hereof and of the Loan Documents and to exercise such
powers as are set forth herein or therein together with
such other powers as are reasonably incidental thereto
(including, without limitation, acting on behalf of, and
for the account of, each Lender and each Issuing Bank in
the creation, execution, perfection, delivery and
enforcement of the Foreign Pledge Agreements). As to any
matters not expressly provided for hereby (including,
without limitation, enforcement or collection of the
Notes or any amount payable under any provision of
Article III when due) or the other Loan Documents, none
of the Agents shall be required to exercise any
discretion or take any action. Notwithstanding the
foregoing, the Administrative Agent shall be required to
act or refrain from acting (and shall be fully protected
in so acting or refraining from acting) upon the
instructions of the Requisite Lenders and such
instructions shall be binding upon all Lenders, Issuing
Banks and Holders; provided, that, the Administrative
Agent shall not be required to take any action that (i)
the Administrative Agent reasonably believes shall expose
it to personal liability unless the Administrative Agent
receives an indemnification satisfactory to it from the
Lenders with respect to such action or (ii) is contrary
hereto, or to the other Loan Documents or applicable law.
The Agents agree to act as such on the express conditions
contained in this Article XII.
(b) The provisions of this Article XII are
solely for the benefit of the Agents, the Lenders and
Issuing Banks, and none of the Company or any Subsidiary
of the Company shall have any rights to rely on or
enforce any of the provisions hereof (other than as
expressly set forth in Sections 12.07 and 12.09). In
performing their respective functions and duties
hereunder, each of the Agents shall act solely as agent
of the Lenders and the Issuing Banks and does not assume
and shall not be deemed to have assumed any obligation or
relationship of agency, trustee or fiduciary with or for
the Company or any Subsidiary of the Company. The Agents
may perform any of their respective duties hereunder or
under the Loan Documents by or through their respective
agents or employees.
12.02. Nature of Duties. None of the Agents
shall have any duties or responsibilities except those
expressly set forth herein or in the Loan Documents. The
duties of the Agents shall be mechanical and
administrative in nature. None of the Agents shall by
reason hereof have a fiduciary relationship in respect of
any Holder. Nothing herein or in any of the Loan
Documents, expressed or implied, is intended to or shall
be construed to impose upon any Agent any obligations in
respect hereof or any of the Loan Documents except as
expressly set forth herein or therein. Each Lender and
each Issuing Bank shall make its own independent
investigation of the financial condition and affairs of
the Company and its Subsidiaries in connection with the
making and the continuance of the Loans hereunder and
with the Issuance of the Letters of Credit and shall make
its own appraisal of the creditworthiness of the Company
and its Subsidiaries initially and on a continuing basis,
and none of the Agents shall have any duty or
responsibility, either initially or on a continuing
basis, to provide any Holder with any credit or other
information with respect thereto (except for reports
required to be delivered by any Agent under the terms
hereof). If any Agent seeks the consent or approval of
any of the Lenders to the taking or refraining from
taking of any action hereunder, such Agent shall send
notice thereof to each Lender. The Administrative Agent
shall promptly notify each Lender at any time that the
Lenders so required hereunder have instructed any Agent
to act or refrain from acting pursuant hereto.
12.03. Rights, Exculpation, Etc. (a)
Liabilities; Responsibilities. None of the Agents or any
Affiliate of the Agents, nor any of their respective
officers, directors, employees or agents shall be liable
to any Holder for any action taken or omitted by them
hereunder or under any of the Loan Documents, or in
connection therewith, except that no Person shall be
relieved of any liability imposed by law for gross
negligence or willful misconduct. None of the Agents
shall be liable for any apportionment or distribution of
payments made by it in good faith pursuant to Section
3.02(b), and if any such apportionment or distribution is
subsequently determined to have been made in error the
sole recourse of any Holder to whom payment was due, but
not made, shall be to recover from other Holders any
payment in excess of the amount to which they are
determined to have been entitled. None of the Agents
shall be responsible to any Holder for any recitals,
statements, representations or warranties herein or for
the execution, effectiveness, genuineness, validity,
legality, enforceability, collectability, or sufficiency
hereof or of any of the other Loan Documents or the
transactions contemplated thereby, or for the financial
condition of the Company or any of its Subsidiaries.
None of the Agents shall be required to make any inquiry
concerning either the performance or observance of any of
the terms, provisions or conditions hereof or of any of
the Loan Documents or the financial condition of the
Company or any of its Subsidiaries, or the existence or
possible existence of any Default or Event of Default.
(b) Right to Request Instructions. The
Administrative Agent may at any time request instructions
from the Lenders with respect to any actions or approvals
that by the terms of any of the Loan Documents the
Administrative Agent is permitted or required to take or
to grant, and the Administrative Agent shall be
absolutely entitled to refrain from taking any action or
to withhold any approval and shall not be under any
liability whatsoever to any Person for refraining from
any action or withholding any approval under any of the
Loan Documents until it shall have received such
instructions from those Lenders from whom the
Administrative Agent is required to obtain such
instructions for the pertinent matter in accordance with
the Loan Documents. Without limiting the generality of
the foregoing, no Holder shall have any right of action
whatsoever against the Administrative Agent as a result
of the Administrative Agent acting or refraining from
acting under the Loan Documents in accordance with the
instructions of the Requisite Lenders or, where required
by the express terms hereof, a greater proportion of the
Lenders.
12.04. Reliance. The Administrative Agent
shall be entitled to rely upon any written notices,
statements, certificates, orders or other documents or
any telephone message believed by it in good faith to be
genuine and correct and to have been signed, sent or made
by the proper Person, and with respect to all matters
pertaining hereto or to any of the Loan Documents and its
duties hereunder or thereunder, upon advice of legal
counsel (including counsel for the Borrowers),
independent public accountants and other experts selected
by it.
12.05. Indemnification. To the extent that
any Agent is not reimbursed and indemnified by the
Borrowers, the Lenders shall reimburse and indemnify such
Agent for and against any and all liabilities,
obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any
kind or nature whatsoever that may be imposed on,
incurred by, or asserted against such Agent in any way
relating to or arising out of the Loan Documents or any
action taken or omitted by such Agent under the Loan
Documents, in proportion to each Lender's Aggregate Pro
Rata Share; provided, that the Lenders shall have no
obligation to any Agent with respect to the matters
indemnified pursuant to this Section resulting from the
willful misconduct or gross negligence of such Agent, as
determined in a final, non-appealable judgment by a court
of competent jurisdiction. The obligations of the
Lenders under this Section 12.05 shall survive the
payment in full of the Loans, the Reimbursement
Obligations and all other Obligations and the termination
hereof.
12.06. Citibank and Credit Suisse
Individually. With respect to their respective Aggregate
Pro Rata Shares of the Commitments hereunder, if any, and
the Loans made by each of them, if any, Citibank and
Credit Suisse shall each have and may exercise the same
rights and powers hereunder and are each subject to the
same obligations and liabilities as and to the extent set
forth herein for any other Lender. The terms "Lenders"
or "Requisite Lenders" or any similar terms shall, unless
the context clearly indicates otherwise, include Citibank
and Credit Suisse in their respective individual
capacities as a Lender or as one of the Requisite
Lenders. Citibank and its Affiliates may accept deposits
from, lend money to, and generally engage in any kind of
banking, trust or other business with the Company or any
of its Subsidiaries as if Citibank were not acting as
Administrative Agent pursuant hereto.
12.07. Successor Administrative Agent;
Resignation of Administrative Agent and Syndication
Agent. (a) Resignation. The Administrative Agent (or
either one of them) may resign from the performance of
its functions and duties hereunder at any time by giving
at least thirty (30) Business Days' prior written notice
to the Borrowers and the Lenders. The resignation of the
Administrative Agent shall take effect upon the
acceptance by a successor Administrative Agent of
appointment pursuant to this Section 12.07. The
Syndication Agent may resign at any time without the
necessity of appointing a successor Syndication Agent.
(b) Appointment by Requisite Lenders. Upon
any such notice of resignation by the Administrative
Agent, the Requisite Lenders shall have the right to
appoint a successor Administrative Agent selected from
among the Lenders, which appointment shall be subject to
the prior written approval of the Company (which may not
be unreasonably withheld, and shall not be required upon
the occurrence and during the continuance of an Event of
Default).
(c) Appointment by Retiring Administrative
Agent. If a successor Administrative Agent shall not
have been appointed within the thirty (30) Business Day
period provided in paragraph (a) of this Section 12.07,
the retiring Administrative Agent, with the consent of
the Company (which may not be unreasonably withheld, and
shall not be required upon the occurrence and during the
continuance of an Event of Default), shall then appoint a
successor Administrative Agent who shall serve as
Administrative Agent until such time, if any, as the
Requisite Lenders appoint a successor Administrative
Agent as provided above.
(d) Rights of the Successor and Retiring
Administrative Agent. Upon the acceptance of any
appointment as Administrative Agent hereunder by a
successor Administrative Agent, such successor
Administrative Agent shall thereupon succeed to and
become vested with all the rights, powers, privileges and
duties of the retiring Administrative Agent, and the
retiring Administrative Agent shall be discharged from
its duties and obligations hereunder thereafter to be
performed. After any retiring Administrative Agent's
resignation hereunder as Administrative Agent, the
provisions of this Article XII shall inure to its benefit
as to any actions taken or omitted to be taken by it
while it was the Administrative Agent hereunder.
12.08. Relations Among Lenders. Each Lender
and each Issuing Bank agrees that it shall not take any
legal action, nor institute any actions or proceedings,
against any of the Borrowers or any other obligor
hereunder or with respect to any Collateral without the
prior written consent of the Requisite Lenders. Without
limiting the generality of the foregoing, no Lender may
accelerate or otherwise enforce its portion of the
Obligations, or terminate its Commitment except in
accordance with Section 11.02(a) or a setoff permitted by
Section 13.05.
12.09. Concerning the Collateral and the Loan
Documents. (a) Authority. Each Lender and each Issuing
Bank authorizes and directs the Administrative Agent, on
its behalf and for its account, to enter into the Loan
Documents relating to the Collateral for the benefit of
the Lenders and the Issuing Banks. Each Lender and each
Issuing Bank agrees that any action taken by the
Administrative Agent or the Requisite Lenders (or, where
required by the express terms hereof, a different
proportion of the Lenders) in accordance with the
provisions hereof or of the other Loan Documents, and the
exercise by the Administrative Agent or the Requisite
Lenders (or, where so required, such different
proportion) of the powers set forth herein or therein,
together with such other powers as are reasonably
incidental thereto, shall be authorized and binding upon
all of the Lenders and Issuing Banks. Without limiting
the generality of the foregoing, the Administrative Agent
shall have the sole and exclusive right and authority, on
behalf of, and for the account of, each Lender and each
Issuing Bank, to (i) act as the disbursing and collecting
agent for the Lenders and the Issuing Banks with respect
to all payments and collections arising in connection
herewith and with the Loan Documents; (ii) execute and
deliver each Loan Document relating to the Collateral and
accept delivery of each such agreement delivered by the
Company or any of its Subsidiaries; (iii) act as
collateral agent for the Lenders and the Issuing Banks
for purposes of the perfection of all security interests
and Liens created by such agreements and all other
purposes stated therein; provided, that the
Administrative Agent hereby appoints, authorizes and
directs each Lender and each Issuing Bank to act as
collateral sub-agent for the Administrative Agent, the
Lenders and the Issuing Banks for purposes of the
perfection of all security interests and Liens with
respect to the Company's and its Subsidiaries' respective
deposit accounts maintained with, and cash and Cash
Equivalents held by, such Lender or such Issuing Bank;
(iv) manage, supervise and otherwise deal with the
Collateral; (v) take such action as is necessary or
desirable to maintain the perfection and priority of the
security interests and liens created or purported to be
created by the Loan Documents; and (vi) except as may be
otherwise specifically restricted by the terms hereof or
of any other Loan Document, exercise all remedies given
to the Administrative Agent, the Lenders or the Issuing
Banks under the Loan Documents, applicable law or
otherwise.
(b) Release of Collateral. (i) Each of the
Lenders and the Issuing Banks hereby directs the
Administrative Agent to release any Lien held by the
Administrative Agent for the benefit of the
Administrative Agent, the Issuing Banks and the other
Holders:
(A) against all of the Collateral, upon
final payment in full of the Obligations and
termination hereof; and
(B) against any part of the Collateral sold or
disposed of by the Company or any of its
Subsidiaries, if such sale or disposition is
permitted by Section 9.02 (or permitted pursuant to
a waiver or consent of a transaction otherwise
prohibited by such Section) or, if not pursuant to
such sale or disposition, (1) against less than
substantially all of the Collateral, if such release
is consented to by Requisite Lenders and (2) against
all or substantially all of the Collateral, if such
release is consented to by Lenders whose Aggregate
Pro Rata Shares, in the aggregate, are equal to
100%.
(ii) Each of the Lenders and the Issuing Banks
hereby directs the Administrative Agent to execute and
deliver or file such termination and partial release
statements and do such other things as are necessary to
release Liens to be released pursuant to this
Section 12.09(b) promptly upon the effectiveness of any
such release.
(c) Confirmation by Lenders. Without in any
manner limiting the Administrative Agent's authority to
act without any specific or further authorization or
consent by the Lenders (as set forth in subsection (b)
above), each Lender agrees to confirm in writing, upon
request by the Administrative Agent or the Company, the
authority to release Collateral conferred upon the
Administrative Agent under clauses (A) and (B) of
subsection (b) above. As long as no Event of Default is
then continuing, upon receipt by the Administrative Agent
of any such written confirmation from the Lenders of the
Administrative Agent's authority to release any
particular items or types of Collateral, and in any event
upon any sale and transfer of Collateral that is
expressly permitted pursuant to the terms of this
Agreement, and upon at least five (5) Business Days'
prior written request by the Company, the Administrative
Agent shall (and is hereby irrevocably authorized by the
Lenders to) execute such documents as may be necessary to
evidence the release of the Liens upon such Collateral
granted to the Administrative Agent for the benefit of
the Administrative Agent, the Lenders, the Issuing Banks
and the other Holders; provided, that (i) the
Administrative Agent shall not be required to execute any
such document on terms that, in the Administrative
Agent's opinion, would expose the Administrative Agent to
liability or create any obligation or entail any
consequence other than the release of such Liens without
recourse or warranty, and (ii) such release shall not in
any manner discharge, affect or impair the Obligations or
any Liens upon (or obligations of the Company or any of
its Subsidiaries in respect of) all interests retained by
the Company and/or any of its Subsidiaries, including,
without limitation, the proceeds of any sale, all of
which shall continue to constitute part of the
Collateral.
(d) No Obligation. The Administrative Agent
shall not have any obligation whatsoever to any Lender or
to any other Person to assure that the Collateral exists
or is owned by the Company or any of its Subsidiaries or
is cared for, protected or insured or has been encumbered
or that the Liens granted to the Administrative Agent
herein or pursuant to the Loan Documents have been
properly or sufficiently or lawfully created, perfected,
protected or enforced or are entitled to any particular
priority, or to exercise at all or in any particular
manner or under any duty of care, disclosure or fidelity,
or to continue exercising, any of the rights, authorities
and powers granted or available to the Administrative
Agent in this Section 12.09 or in any of the Loan
Documents, it being understood and agreed that in respect
of the Collateral, or any act, omission or event related
thereto, the Administrative Agent may act in any manner
it may deem appropriate, in its sole discretion, given
the Administrative Agent's own interests in the
Collateral as one of the Lenders and that the
Administrative Agent shall not have any duty or liability
whatsoever to any Lender.
ARTICLE XIII
MISCELLANEOUS
13.01. Assignments and Participations. (a)
Assignments. No assignments or participations of any
Lender's rights or obligations hereunder shall be made
except in accordance with this Section 13.01. Each
Lender may assign to one or more Eligible Assignees all
or a portion of its rights and obligations hereunder
(including all of its rights and obligations with respect
to the Revolving Loans and the Letters of Credit) in
accordance with the provisions of this Section 13.01.
(b) Limitations on Assignments. Each
assignment by a Lender (an "Assigning Lender") shall be
subject to the following conditions: (i) each assignment
(other than to a Lender or an Affiliate of a Lender)
shall be approved by the Administrative Agent and the
Company, which approval shall not be unreasonably
withheld; (ii) each such assignment shall be to an
Eligible Assignee; (iii) each such assignment shall be in
an amount at least equal to $10,000,000, except if the
Eligible Assignee is a Lender or an Affiliate of Lender
(in which case the assignment may be in any amount) or if
such assignment shall constitute all the assigning
Lender's interest hereunder; (iv) any such assignment
(other than any such assignment to an Affiliate of the
Assigning Lender) shall consist of the simultaneous
assignment of corresponding pro rata portions of the
assigning Lender's Revolving Credit Commitment and
Revolving Credit Loans, and (v) the parties to each such
assignment shall execute and deliver to the
Administrative Agent, for its acceptance and recording in
the Register, an Assignment and Acceptance. Upon such
execution, delivery, acceptance and recording in the
Register, from and after the effective date specified in
each Assignment and Acceptance and agreed to by the
Administrative Agent, (x) the assignee thereunder shall,
in addition to any rights and obligations hereunder held
by it immediately prior to such effective date, if any,
have the rights and obligations hereunder that have been
assigned to it pursuant to such Assignment and Acceptance
and shall, to the fullest extent permitted by law, have
the same rights and benefits hereunder as if it were an
original Lender hereunder and (y) the Assigning Lender
shall, to the extent that rights and obligations
hereunder have been assigned by it pursuant to such
Assignment and Acceptance, relinquish its rights and be
released from its obligations hereunder (and, in the case
of an Assignment and Acceptance covering all or the
remaining portion of such Assigning Lender's rights and
obligations hereunder, the Assigning Lender shall cease
to be a party hereto).
(c) The Register. The Administrative Agent
shall maintain at its address referred to in Section
13.08 a copy of each Assignment and Acceptance delivered
to and accepted by it and a register (the "Register") for
the recordation of the names and addresses of the Lenders
and the Revolving Credit Commitment under each Loan of,
and principal amount of the Loans under each facility
owing to, each Lender from time to time and whether such
Lender is an original Lender or the assignee of another
Lender pursuant to an Assignment and Acceptance. The
Register shall include a control account, and a
subsidiary account for each Lender, in which accounts
(taken together) shall be recorded (i) the date and
amount of each Borrowing made hereunder, and by which
Borrower the Borrowing is made, (ii) the effective date
and amount of each Assignment and Acceptance delivered to
and accepted by it and the parties thereto, (iii) the
amount of any principal or interest due and payable or to
become due and payable from each Borrower to each Lender
hereunder or under the Notes, and (iv) the amount of any
sum received by the Administrative Agent from any
Borrower or any Subsidiary Guarantor hereunder and each
Lender's share thereof. The Administrative Agent shall
deliver a statement of such account to the Company
whenever an Assignment and Acceptance is accepted by it
and the parties hereto; provided, that the Administrative
Agent shall not be obligated to deliver such statement
more frequently than once a month. Each such statement
shall be deemed final, binding and conclusive upon the
Borrowers in all respects as to all matters reflected
therein (absent manifest error) unless the Company,
within thirty (30) days after the date such statement is
delivered to the Company, delivers to the Administrative
Agent written notice of any objections that the Borrowers
may have to any such statement. In that event, only
those items expressly objected to in such notice shall be
deemed to be disputed by the Borrowers. The entries in
the Register shall be conclusive and binding for all
purposes, absent manifest error, and the Company and each
of its Subsidiaries, the Administrative Agent and the
Lenders may treat each Person whose name is recorded in
the Register as a Lender hereunder for all purposes
hereof. The Register shall be available for inspection
by the Borrowers or any Lender at any reasonable time and
from time to time upon reasonable prior notice.
(d) Fee. Upon its receipt of an Assignment
and Acceptance executed by the Assigning Lender and an
Eligible Assignee and a processing and recordation fee of
$3,000 (payable by the Assigning Lender or the assignee,
as shall be agreed between them), the Administrative
Agent shall, if such Assignment and Acceptance has been
completed and is in compliance herewith and in
substantially the form of Exhibit A, (i) accept such
Assignment and Acceptance, (ii) record the information
contained therein in the Register and (iii) give prompt
notice thereof to the Company and the other Lenders.
(e) Information Regarding the Borrowers. Any
Lender may, in connection with any assignment or proposed
assignment pursuant to this Section 13.01, disclose to
the assignee or proposed assignee any information
relating to the Company or its Subsidiaries furnished to
such Lender by the Administrative Agent or by or on
behalf of the Borrowers; provided, that, prior to any
such disclosure, such assignee or proposed assignee shall
agree (for the Borrowers' benefit) to preserve in
accordance with Section 13.20 the confidentiality of any
confidential information described therein.
(f) Lenders' Creation of Security Interests.
Notwithstanding any other provision set forth herein, any
Lender may at any time create a security interest in all
or any portion of its rights hereunder (including,
without limitation, Obligations owing to it and Notes
held by it) in favor of any Federal Reserve bank in
accordance with Regulation A.
(g) Assignments by an Issuing Bank. If any
Issuing Bank ceases to be a Lender hereunder by virtue of
any assignment made pursuant to this Section 13.01, then,
as of the effective date of such cessation, such Issuing
Bank's obligations to Issue Letters of Credit pursuant to
Section 2.04 shall terminate and such Issuing Bank shall
be an Issuing Bank hereunder only with respect to
outstanding Letters of Credit Issued prior to such date.
(h) Participations. Each Lender may sell
participations to one or more other financial
institutions in or to all or a portion of its rights and
obligations under and in respect of any and all
facilities hereunder (including, without limitation, all
or a portion of any or all of its Revolving Credit
Commitments hereunder and the Loans owing to it and its
undivided interest in the Letters of Credit); provided,
that (i) such Lender's obligations hereunder (including,
without limitation, its Revolving Credit Commitments
hereunder) shall remain unchanged, (ii) such Lender shall
remain solely responsible to the other parties hereto for
the performance of such obligations, (iii) the Borrowers,
the Administrative Agent and the other Lenders shall
continue to deal solely and directly with such Lender in
connection with such Lender's rights and obligations
hereunder and (iv) such participant's rights to agree or
to restrict such Lender's ability to agree to the
modification, waiver or release of any of the terms of
the Loan Documents, to consent to any action or failure
to act by any party to any of the Loan Documents or any
of their respective Subsidiaries or Affiliates, or to
exercise or refrain from exercising any powers or rights
that such Lender may have under or in respect of the Loan
Documents or any Collateral, shall be limited to the
right to consent to (A) reduction of the principal of, or
rate or amount of interest on the Loan(s) subject to such
participation (other than by the payment or prepayment
thereof), (B) postponement of any scheduled date for any
payment of principal of, or interest on, the Loan(s)
subject to such participation (except with respect to any
modifications of the applicable provisions relating to
the prepayments of Loans and other Obligations) and (C)
release of any Subsidiary Guarantor (except as provided
in Section 9.09) or all or substantially all of the
Collateral (except as provided in Section 12.09(b)). No
holder of a participation in all or any part of the Loans
shall be a "Lender" or a "Holder" for any purposes
hereunder by reason of such participation; provided, that
each holder of a participation shall be entitled to the
benefits provided to a Lender (including any right to
receive payment) under Sections 3.03, 3.04, 4.01(f),
4.02(d), 4.02(e), 12.05, 13.02 and 13.05; provided, that
all requests for any such payments shall be made by a
participant through the Lender granting such
participation. The right of each holder of a
participation to receive payment under Sections 3.03,
3.04, 4.01(f), 4.02(d), 4.02(e), 12.05, 13.02 and 13.05
shall be limited to the lesser of (i) the amounts
actually incurred by such holder for which payment is
provided under said Sections and (ii) the participant's
share of the amounts that would have been payable under
said Sections by the applicable Borrower to the Lender
granting the participation in respect of the participated
interest to such holder had such participation not been
granted.
(i) Payment to Participants. Anything herein
to the contrary notwithstanding, in the case of any
participation, all amounts payable by the Borrowers under
the Loan Documents shall be calculated and made in the
manner and to the parties required hereby as if no such
participation had been sold.
13.02. Expenses.
(a) Generally. Each of the Borrowers agrees
upon demand to pay, or reimburse the Administrative Agent
for all of the Administrative Agent's and its Affiliates'
internal and external audit, legal, appraisal, valuation,
filing, document duplication and reproduction and
investigation expenses and for all other reasonable out-
of-pocket costs and expenses of every type and nature
(including, without limitation, the reasonable fees,
expenses and disbursements of the Administrative Agent's
counsel, Sidley & Austin, local legal counsel, auditors,
accountants, appraisers, printers, insurance and
environmental advisers and other consultants and agents)
incurred by the Administrative Agent in connection with
(to the extent any of the following is applicable to such
Borrower) (A) the Administrative Agent's audit and
investigation of such Borrower and its Subsidiaries in
connection with the preparation, negotiation, and
execution of the Loan Documents and the Administrative
Agent's periodic audits of such Borrower or its
Subsidiaries; (B) the preparation, negotiation, execution
and interpretation hereof (including, without limitation,
the satisfaction or attempted satisfaction of any of the
conditions set forth in Article V), and of the other Loan
Documents and any proposal letter or commitment letter
issued in connection therewith and the making of the
Loans hereunder and the syndication of the Revolving
Credit Commitments; (C) the creation, perfection or
protection of the Liens under the Loan Documents
(including, without limitation, any reasonable fees and
expenses for local counsel in various jurisdictions); (D)
the ongoing administration hereof and of the Loans,
including consultation with attorneys in connection
therewith and with respect to the Administrative Agent's
rights and responsibilities hereunder and under the other
Loan Documents; (E) the protection, collection or
enforcement of any of the Obligations or the enforcement
of any of the Loan Documents; (F) the commencement,
defense or intervention in any court proceeding relating
in any way to the Obligations, the Property, the
Collateral, the Company, any of the Company's
Subsidiaries, this Agreement or any of the other Loan
Documents; (G) the response to, and preparation for, any
subpoena or request for document production with which
the Administrative Agent is served or deposition or other
proceeding in which the Administrative Agent is called to
testify, in each case, relating in any way to the
Obligations, the Property, the Company, any of the
Company's Subsidiaries, this Agreement or any of the
other Loan Documents; and (H) any amendments, consents,
waivers, assignments, restatements or supplements to any
of the Loan Documents and the preparation, negotiation
and execution of the same. In addition, each of the
Borrowers agrees upon demand to pay, or reimburse the
Syndication Agent for all of the out-of-pocket costs and
reasonable expenses of the Syndication Agent and its
Affiliates of every type and nature (including, without
limitation, the reasonable fees, expenses and
disbursements of the Syndication Agent's counsel)
incurred by the Syndication Agent in connection with the
negotiation and execution of the Loan Documents and the
syndication of the Revolving Credit Commitments, in each
case with respect to such Borrower. To the extent that
the undertaking to pay and reimburse the Administrative
Agent set forth in this Section may be unenforceable
(with respect to such Borrower) because it is violative
of any law or public policy, such Borrower shall
contribute the maximum portion that it is permitted to
pay under applicable law.
(b) After Default. Each of the Borrowers
further agrees to pay or reimburse the Administrative
Agent, the Syndication Agent, the Issuing Banks and the
Lenders upon demand, to the extent applicable to such
Borrower, for all out-of-pocket costs and expenses,
including, without limitation, reasonable attorneys'
fees, incurred by the Administrative Agent, the
Syndication Agent, any Issuing Bank or any Lender (i) in
enforcing any Loan Document or Obligation or any security
therefor or exercising or enforcing any other right or
remedy available by reason of any Event of Default; (ii)
in connection with any refinancing or restructuring of
the credit arrangements provided hereunder in the nature
of a "work-out" or in any insolvency or bankruptcy
proceeding; (iii) in commencing, defending or intervening
in any litigation or in filing a petition, complaint,
answer, motion or other pleadings in any legal proceeding
relating to the Obligations, the Property, the
Collateral, such Borrower or any of such Borrower's
Subsidiaries, and related to or arising out of the
transactions contemplated hereby or by any of the other
Loan Documents; and (iv) in taking any other action in or
with respect to any suit or proceeding (bankruptcy or
otherwise) described in clauses (i) through (iii) above.
To the extent that the undertaking to pay and reimburse
the Administrative Agent, the Syndication Agent, the
Issuing Banks and the Lenders set forth in this Section
may be unenforceable (with respect to a Borrower) because
it is violative of any law or public policy, such
Borrower shall contribute the maximum portion that it is
permitted to pay under applicable law.
13.03. Indemnity. Each Borrower further
agrees to defend, protect, indemnify, and hold harmless
the Administrative Agent, the Syndication Agent and each
and all of the Lenders and Issuing Banks and each of
their respective Affiliates, and each of such
Administrative Agent's, Syndication Agent's, Lender's,
Issuing Bank's or Affiliate's respective officers,
directors, employees, attorneys and agents (including,
without limitation, those retained in connection with the
satisfaction or attempted satisfaction of any of the
conditions set forth in Article V) (collectively, the
"Indemnitees") from and against any and all liabilities,
obligations, losses, damages, penalties, actions,
judgments, suits, claims, costs, reasonable expenses and
disbursements of any kind or nature whatsoever
(including, without limitation, the reasonable fees and
disbursements of counsel for such Indemnitees in
connection with any investigative, administrative or
judicial proceeding, whether or not such Indemnitees
shall be designated a party thereto), imposed on,
incurred by, or asserted against such Indemnitees in any
manner relating to or arising out of or in connection
with (a) this Agreement, the other Loan Documents, any of
the other Transaction Documents or any act, event or
transaction related or attendant thereto applicable to
such Borrower, whether or not such Indemnitee is a party
thereto and whether or not the making of the Loans, the
issuance of and participation in Letters of Credit
hereunder, the management of such Loans or Letters of
Credit, the use or intended use of the proceeds of the
Loans or Letters of Credit hereunder, the execution,
delivery and/or performance of Currency Agreements or
Interest Rate Contracts, are consummated or any of the
other transactions contemplated by the Transaction
Documents are consummated, or (b) any Liabilities and
Costs under Environmental, Health or Safety Requirements
of Law arising from or in connection with the past,
present or future operations of the Borrower, such
Borrower's Subsidiaries or any of their respective
predecessors in interest, or the past, present or future
environmental, health or safety condition of any
respective Property of such Borrower or its Subsidiaries,
the presence of asbestos-containing materials at any
respective Property of such Borrower or its Subsidiaries
or the Release or threatened Release of any Contaminant
into the environment (collectively, the "Indemnified
Matters"); provided, that none of the Borrowers shall
have any obligation to an Indemnitee hereunder with
respect to Indemnified Matters resulting from the willful
misconduct or gross negligence of such Indemnitee, as
determined in a final, non-appealable judgment by a court
of competent jurisdiction; and provided, further, that
neither of Danutec Werkstoff, CML or Brochier shall be
liable for any Indemnified Matters to the extent such
Indemnified Matter relates to or is associated with the
Acquisition of Danutec Werkstoff, CML or Brochier, as
applicable. Notwithstanding anything herein to the
contrary, each of the Borrowers understands and hereby
agrees that its obligation to indemnify pursuant to this
Section 13.03 shall apply in the event of the sole,
concurrent or contributory negligence of any Indemnitee.
To the extent that the undertaking to indemnify, pay and
hold harmless set forth in the preceding sentence may be
unenforceable because it is violative of any law or
public policy, each Borrower shall contribute the maximum
portion that it is permitted to pay and satisfy under
applicable law to the payment and satisfaction of all
Indemnified Matters relating to such Borrower incurred by
the Indemnitees.
13.04. Change in Accounting Principles. If
any change in the accounting principles used in the
preparation of the most recent financial statements
referred to in Section 7.01 is hereafter required or
permitted by the rules, regulations, pronouncements and
opinions of the Financial Accounting Standards Board or
the American Institute of Certified Public Accountants
(or successors thereto or agencies with similar
functions) and are adopted by any of the Borrowers with
the agreement of its independent certified public
accountants, and such change results in a change in the
method of calculation of any of the covenants, standards
or terms found in Article IX and Article X, the parties
hereto agree to enter into negotiations in order to amend
such provisions so as to equitably reflect such change
with the desired result that the criteria for evaluating
compliance with such covenants, standards and terms by
the Borrowers shall be the same after such change as if
such change had not been made; provided, that no change
in GAAP that would affect the method of calculation of
any of the covenants, standards or terms shall be given
effect in such calculations until such provisions are
amended, in a manner reasonably satisfactory to the
Requisite Lenders and the Borrowers, to so reflect such
change in accounting principles.
13.05. Setoff. In addition to any Liens
granted under the Loan Documents and any rights now or
hereafter granted under applicable law, and to the extent
permitted by applicable law, upon the occurrence and
during the continuance of any Event of Default, and with
the prior written consent of the Requisite Lenders, each
Lender, each Issuing Bank and any Affiliate of any Lender
or Issuing Bank is hereby authorized by the Borrowers at
any time or from time to time, without notice to any
Person (any such notice being hereby expressly waived) to
set off and to appropriate and to apply any and all
deposits (general or special, including, but not limited
to, indebtedness evidenced by certificates of deposit,
whether matured or unmatured (but not including trust
accounts)) and any other Indebtedness at any time held or
owing by such Lender, Issuing Bank or any of their
Affiliates to or for the credit or the account of the
Borrowers against and on account of the Obligations of
the Borrowers to such Lender, Issuing Bank or any of
their Affiliates, including, but not limited to, all
Loans and Letters of Credit and all claims of any nature
or description arising out of or in connection herewith,
irrespective of whether or not (i) such Lender or Issuing
Bank shall have made any demand hereunder or (ii) the
Administrative Agent, at the request or with the consent
of the Requisite Lenders, shall have declared the
principal of and interest on the Loans and other amounts
due hereunder to be due and payable as permitted by
Article XI and even though such Obligations may be
contingent or unmatured.
13.06. Ratable Sharing. The Lenders and the
Issuing Banks agree among themselves that, except as
otherwise expressly provided in any Loan Document, (i)
with respect to all amounts received by them that are
applicable to the payment of the Obligations (excluding
(x) the fees described in Sections 2.04(g), 3.03, 3.04,
4.01(f) and 4.02 and (y) any amounts so received in
respect of Currency Agreements and/or Interest Rate
Contracts) equitable adjustment shall be made so that, in
effect, all such amounts shall be shared among them
ratably in accordance with their Aggregate Pro Rata
Shares, whether received by voluntary payment, by the
exercise of the right of setoff or banker's lien, by
counterclaim or cross-action or by the enforcement of any
or all of such Obligations (excluding the fees described
in Sections 2.04(g), 3.03, 3.04, 4.01(f) and 4.02) or the
Collateral, (ii) if any of them shall by voluntary
payment or by the exercise of any right of counterclaim,
setoff, banker's lien or otherwise, receive payment of a
proportion of the aggregate amount of such Obligations
held by it that is greater than the amount that such
Lender is entitled to receive hereunder, the Lender
receiving such excess payment shall purchase, without
recourse or warranty, an undivided interest and
participation (which it shall be deemed to have done
simultaneously upon the receipt of such payment) in such
Obligations owed to the others so that all such
recoveries with respect to such Obligations shall be
applied ratably in accordance with their Aggregate Pro
Rata Shares; provided, that if all or part of such excess
payment received by the purchasing party is thereafter
recovered from it, those purchases shall be rescinded and
the purchase prices paid for such participation shall be
returned to such party to the extent necessary to adjust
for such recovery, but without interest except to the
extent the purchasing party is required to pay interest
in connection with such recovery. Each of the Borrowers
agrees that any Lender so purchasing a participation from
another Lender pursuant to this Section 13.06 may, to the
fullest extent permitted by law, exercise all its rights
of payment (including, subject to Section 13.05, the
right of setoff) with respect to such participation as
fully as if such Lender were the direct creditor of the
Borrowers in the amount of such participation.
13.07. Amendments and Waivers. (a) General
Provisions. Unless otherwise provided herein, no
amendment or modification of any provision hereof shall
be effective without the written agreement of the
Requisite Lenders and the Borrowers, and no termination
or waiver of any provision hereof, or consent to any
departure by the Borrowers therefrom, shall be effective
without the written concurrence of the Requisite Lenders,
which the Requisite Lenders shall have the right to grant
or withhold in their sole discretion.
The Administrative Agent may, but shall have no
obligation to, with the written concurrence of any
Lender, execute amendments, modifications, waivers or
consents on behalf of that Lender. Any waiver or consent
shall be effective only in the specific instance and
for the specific purpose for which it was given. No
notice to or demand on the Borrowers in any case shall
entitle the Borrowers to any other or further notice or
demand in similar or other circumstances.
Notwithstanding anything to the contrary contained in
this Section 13.07, no amendment, modification, waiver or
consent shall affect the rights or duties of the
Administrative Agent hereunder or under the other Loan
Documents, including this Article XIII, unless made in
writing and signed by the Administrative Agent so
affected in addition to the Lenders required above to
take such action. Furthermore, in the event that any
Lender fails to agree to any amendment, modification,
waiver or consent requiring the unanimous approval of the
Lenders pursuant to Section 13.07(b), at the joint
request of the Company and the Administrative Agent, the
Lenders who have so agreed to such amendment,
modification, waiver or consent shall have the right (but
not the obligation) to, or to cause an Eligible Assignee
to, purchase from any non-consenting Lender (at the face
amount thereof) all Revolving Loans, Letter of Credit
Obligations and Revolving Credit Commitments held by such
Lender.
(b) Amendments, Consents and Waivers by all
Lenders. Notwithstanding the foregoing, any amendment,
modification, termination, waiver or consent with respect
to any of the following provisions hereof shall be
effective only by a written agreement, signed by each
Borrower and each Lender:
(i) waiver of any of the conditions specified
in Section 5.01 or 5.02 (except with respect to a
condition based upon another provision hereof, the
waiver of which requires only the concurrence of the
Requisite Lenders),
(ii) increase in the amount of any of the
Revolving Credit Commitments of any Lender,
(iii) reduction of the principal of, rate or
amount of interest on the Loans or Reimbursement
Obligations or any fees or other amounts payable to
any Lender (including, without limitation, amounts
so payable pursuant to Section 3.01(b)),
(iv) extension of the Revolving Credit
Termination Date or postponement of any date on
which any payment of principal of, or interest on,
the Loans or Reimbursement Obligations or any fees
or other amounts payable to any Lender would
otherwise be due,
(v) release of any Subsidiary Guarantor of the
Obligations (except in connection with the sale of
all or substantially all of the Capital Stock or
Property of any Subsidiary Guarantor or a merger of
a Subsidiary Guarantor with or into another
Subsidiary Guarantor or the Company, in each case
approved by the Requisite Lenders or otherwise
permitted hereunder) or all or any portion of the
Collateral (except as provided in Section 12.09(c)),
(vi) change the Aggregate Pro Rata Share of the
Lenders that shall be required for the Lenders or
any of them to take action hereunder,
(vii) change in the definition of Requisite
Lenders, or
(viii) amendment of Sections 12.09(c) or 13.06
or this Section 13.07.
(c) Amendments, Consents and Waivers by
European Overdraft Bank. Notwithstanding the foregoing,
any amendment, modification, termination, waiver or
consent with respect to any provision affecting the
European Overdraft Commitment, the European Overdraft
Loans or the European Overdraft Obligations shall be
effective only by a written agreement signed by each
Borrower and the European Overdraft Bank.
13.08. Notices. (a) Unless otherwise
specifically provided herein, any notice, consent or
other communication herein required or permitted to be
given shall be in writing and may be personally served,
telecopied or sent by courier service, and shall be
deemed to have been given when delivered in person or by
courier service, or upon receipt of a telecopy. Notices
to the Administrative Agent pursuant to Articles II or
III shall not be effective until received by the
Administrative Agent. For the purposes hereof, the
addresses of the parties hereto (until notice of a change
thereof is delivered as provided in this Section 13.08)
shall be as set forth below each party's name on the
signature pages hereof or on the signature page of any
applicable Assignment and Acceptance, or, as to each
party, at such other address as may be designated by such
party in a written notice to all of the other parties
hereto delivered in accordance with this Section 13.08.
(b) Each of the Borrowers agrees to indemnify
and hold harmless each Indemnitee from and against any
and all claims, damages, liabilities, obligations,
losses, penalties, actions, judgments, suits, reasonable
costs, disbursements and expenses of any kind or nature
(including, without limitation, reasonable fees and
disbursements of counsel to any such Indemnitee) that may
be imposed on, incurred by or asserted against any such
Indemnitee in any manner relating to or arising out of
any action taken or omitted by such Indemnitee in good
faith in reliance on any notice or other written
communication in the form of a telecopy or facsimile
purporting to be from such Borrower; provided, that such
Borrower shall not have any obligation under this Section
13.08(b) to an Indemnitee with respect to any indemnified
matter caused by or resulting from the gross negligence
or willful misconduct of that Indemnitee, as determined
by a court of competent jurisdiction in a final non-
appealable judgment or order.
13.09. Survival of Warranties and Agreements.
All representations and warranties made herein and all
obligations of the Borrowers in respect of taxes,
indemnification and expense reimbursement shall survive
the execution and delivery hereof and of the other Loan
Documents, the making and repayment of the Loans, the
issuance and discharge of Letters of Credit hereunder and
the termination hereof, and shall not be limited in any
way by the passage of time or occurrence of any event and
shall expressly cover time periods when the
Administrative Agent, any of the Issuing Banks or any of
the Lenders may have come into possession or control of
any of the Company's or its Subsidiaries' Property.
13.10. Failure or Indulgence Not Waiver;
Remedies Cumulative. No failure or delay on the part of
the Administrative Agent, any Lender or any Issuing Bank
in the exercise of any power, right or privilege under
any of the Loan Documents shall impair such power, right
or privilege or be construed to be a waiver of any
default or acquiescence therein, nor shall any single or
partial exercise of any such power, right or privilege
preclude other or further exercise thereof or of any
other right, power or privilege. All rights and remedies
existing under the Loan Documents are cumulative to and
not exclusive of any rights or remedies otherwise
available.
13.11. Marshalling; Payments Set Aside. None
of the Administrative Agent, any Lender or any Issuing
Bank shall be under any obligation to marshall any assets
in favor of the Borrowers or any other party or against
or in payment of any or all of the Obligations. To the
extent that any Borrower makes a payment or payments to
the Administrative Agent, the Lenders or the Issuing
Banks or any of such Persons receives payment from the
proceeds of the Collateral or exercises its rights of
setoff, and such payment or payments or the proceeds of
such enforcement or setoff or any part thereof are
subsequently invalidated, declared to be fraudulent or
preferential, set aside or required to be repaid to a
trustee, receiver or any other party, then to the extent
of such recovery, the obligation or part thereof
originally intended to be satisfied, and all Liens, right
and remedies therefor, shall be revived and continued in
full force and effect as if such payment had not been
made or such enforcement or setoff had not occurred.
13.12. Severability. In case any provision in
or obligation hereunder or under the other Loan Documents
shall be invalid, illegal or unenforceable in any
jurisdiction, the validity, legality and enforceability
of the remaining provisions or obligations, or of such
provision or obligation in any other jurisdiction, shall
not in any way be affected or impaired thereby.
13.13. Headings. Article and Section headings
herein are included herein for convenience of reference
only and shall not constitute a part hereof or be given
any substantive effect.
13.14. GOVERNING LAW. THIS AGREEMENT SHALL BE
INTERPRETED, AND THE RIGHTS AND LIABILITIES OF THE
PARTIES HERETO DETERMINED, IN ACCORDANCE WITH THE LAWS OF
THE STATE OF NEW YORK.
13.15. Limitation of Liability. No claim may
be made by the Company, any of the Company's
Subsidiaries, any Lender, any Issuing Bank, the
Administrative Agent, the Syndication Agent or any other
Person against the Administrative Agent, the Syndication
Agent, any other Issuing Bank or any other Lender, or the
Affiliates, directors, officers, employees, attorneys or
agents of any of them for any special, consequential or
punitive damages in respect of any claim for breach of
contract or any other theory of liability arising out of
or related to the transactions contemplated hereby, or
any act, omission or event occurring in connection
therewith; and the Company, each of the Company's
Subsidiaries, each Lender, each Issuing Bank, the
Syndication Agent and the Administrative Agent hereby
waives, releases and agrees not to sue upon any such
claim for any such damages, whether or not accrued and
whether or not known or suspected to exist in its favor.
13.16. Successors and Assigns. This Agreement
and the other Loan Documents shall be binding upon the
parties hereto and their respective successors and
permitted assigns and shall inure to the benefit of the
parties hereto and the successors and permitted assigns
of the Lenders and the Issuing Banks. The rights
hereunder and the interest herein of the Borrowers may
not be assigned without the written consent of all
Lenders. Any attempted assignment without such written
consent shall be void.
13.17. Certain Consents and Waivers.
(A) PERSONAL JURISDICTION. (I) EACH OF THE
ADMINISTRATIVE AGENT, THE SYNDICATION AGENT, THE LENDERS,
THE ISSUING BANKS AND THE BORROWERS IRREVOCABLY AND
UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS PROPERTY, TO
THE NONEXCLUSIVE JURISDICTION OF ANY NEW YORK STATE COURT
OR FEDERAL COURT SITTING IN NEW YORK, NEW YORK, AND ANY
COURT HAVING JURISDICTION OVER APPEALS OF MATTERS HEARD
IN SUCH COURTS, IN ANY ACTION OR PROCEEDING ARISING OUT
OF, CONNECTED WITH, RELATED TO OR INCIDENTAL TO THE
RELATIONSHIP ESTABLISHED AMONG THEM IN CONNECTION WITH
THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, WHETHER
ARISING IN CONTRACT, TORT, EQUITY OR OTHERWISE, OR FOR
RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT, AND EACH OF
THE PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY AGREES
THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR
PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH STATE
COURT OR, TO THE EXTENT PERMITTED BY LAW, IN SUCH FEDERAL
COURT. EACH OF THE BORROWERS IRREVOCABLY DESIGNATES AND
APPOINTS CT CORPORATION SYSTEM AT 1633 BROADWAY, NEW
YORK, NEW YORK 10019, AS ITS PROCESS AGENT (THE "PROCESS
AGENT") FOR SERVICE OF ALL PROCESS IN ANY SUCH PROCEEDING
IN ANY SUCH COURT, SUCH SERVICE BEING HEREBY ACKNOWLEDGED
TO BE EFFECTIVE AND BINDING SERVICE IN EVERY RESPECT.
EACH OF THE ADMINISTRATIVE AGENT, THE SYNDICATION AGENT,
THE LENDERS, THE ISSUING BANKS AND THE BORROWERS AGREES
THAT A FINAL NON-APPEALABLE JUDGMENT IN ANY SUCH ACTION
OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN
OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY
OTHER MANNER PROVIDED BY LAW. EACH OF THE ADMINISTRATIVE
AGENT, THE SYNDICATION AGENT, THE LENDERS, THE ISSUING
BANKS AND THE BORROWERS WAIVES IN ALL DISPUTES ANY
OBJECTION THAT IT MAY HAVE TO THE LOCATION OF THE COURT
CONSIDERING THE DISPUTE.
(II) EACH OF THE BORROWERS AGREES THAT THE
ADMINISTRATIVE AGENT SHALL HAVE THE RIGHT TO PROCEED
AGAINST THE BORROWERS OR THEIR RESPECTIVE PROPERTY IN A
COURT IN ANY LOCATION TO ENABLE THE ADMINISTRATIVE AGENT,
THE SYNDICATION AGENT, THE ISSUING BANKS AND THE LENDERS
TO REALIZE ON THE COLLATERAL OR ANY OTHER SECURITY FOR
THE OBLIGATIONS, OR TO ENFORCE A JUDGMENT OR OTHER COURT
ORDER ENTERED IN FAVOR OF THE ADMINISTRATIVE AGENT, THE
SYNDICATION AGENT, ANY ISSUING BANK OR ANY LENDER. EACH
OF THE BORROWERS WAIVES ANY OBJECTION THAT IT MAY HAVE TO
THE LOCATION OF THE COURT IN WHICH THE ADMINISTRATIVE
AGENT, THE SYNDICATION AGENT, ANY ISSUING BANK OR ANY
LENDER MAY COMMENCE A PROCEEDING DESCRIBED IN THIS
SECTION.
(B) SERVICE OF PROCESS. EACH OF THE BORROWERS
IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS OF ANY OF
THE AFOREMENTIONED COURTS IN ANY SUCH ACTION OR
PROCEEDING BY THE MAILING OF COPIES THEREOF BY REGISTERED
OR CERTIFIED MAIL, POSTAGE PREPAID, TO THE PROCESS AGENT
OR THE BORROWERS' NOTICE ADDRESS SPECIFIED IN SECTION
13.08, SUCH SERVICE TO BECOME EFFECTIVE FIVE (5) DAYS
AFTER SUCH MAILING; PROVIDED, THAT NONE OF THE BORROWERS
HEREBY REPRESENTS THAT SUCH SERVICE OF PROCESS IS
ADEQUATE UNDER APPLICABLE LAW WHEN PROCEEDINGS ARE
BROUGHT AGAINST A BORROWER PURSUANT TO SECTION
13.17(A)(II). EACH OF THE BORROWERS IRREVOCABLY WAIVES
ANY OBJECTION (INCLUDING, WITHOUT LIMITATION, ANY
OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS
OF FORUM NON CONVENIENS) THAT IT MAY NOW OR HEREAFTER
HAVE TO THE BRINGING OF ANY SUCH ACTION OR PROCEEDING
WITH RESPECT TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT
IN THE JURISDICTION SET FORTH ABOVE. NOTHING HEREIN
SHALL AFFECT THE RIGHT TO SERVE PROCESS IN ANY OTHER
MANNER PERMITTED BY LAW OR SHALL LIMIT THE RIGHT OF THE
ADMINISTRATIVE AGENT TO BRING PROCEEDINGS AGAINST ANY
BORROWER IN THE COURTS OF ANY OTHER JURISDICTION.
(C) WAIVER OF JURY TRIAL. TO THE EXTENT
PERMITTED BY APPLICABLE LAW, EACH OF THE ADMINISTRATIVE
AGENT, THE SYNDICATION AGENT, THE ISSUING BANKS, THE
LENDERS AND THE BORROWERS IRREVOCABLY WAIVES TRIAL BY
JURY IN ANY ACTION OR PROCEEDING WITH RESPECT TO THIS
AGREEMENT OR ANY OTHER LOAN DOCUMENT.
13.18. Counterparts; Effectiveness;
Inconsistencies. This Agreement and any amendments,
waivers, consents, or supplements hereto may be executed
in counterparts, each of which when so executed and
delivered shall be deemed an original, but all such
counterparts together shall constitute but one and the
same instrument. This Agreement shall be effective
against each Borrower, each Lender, each Issuing Bank,
the Syndication Agent and the Administrative Agent as of
the date hereof immediately upon the execution hereof by
all such parties. This Agreement and each of the other
Loan Documents shall be construed to the extent
reasonable to be consistent one with the other, but to
the extent that the terms and conditions hereof are
actually inconsistent with the terms and conditions of
any other Loan Document, this Agreement shall govern.
13.19. Limitation on Agreements. All
agreements between the Borrowers, the Administrative
Agent, the Syndication Agent, each Lender and each
Issuing Bank in the Loan Documents are hereby expressly
limited so that in no event shall any of the Loans or
other amounts payable by the Borrowers under any of the
Loan Documents be directly or indirectly secured (within
the meaning of Regulation U) by Margin Stock.
13.20. Confidentiality. Subject to
Section 13.01(e), the Administrative Agent, the
Syndication Agent, the Lenders and the Issuing Banks
shall hold all nonpublic information obtained pursuant to
the requirements hereof and identified as such by any
Borrower in accordance with such Person's customary
procedures for handling confidential information of this
nature and in accordance with safe and sound banking
practices and in any event may make disclosure reasonably
required by a bona fide offeree, assignee or participant
in connection with the contemplated transfer or
participation, or as required or requested by any
Governmental Authority or representative thereof, or
pursuant to legal process, or to its accountants, lawyers
and other advisors, and shall require any such offeree,
assignee or participant to agree (and require any of its
offerees, assignees or participants to agree) to comply
with this Section 13.20. In no event shall the
Administrative Agent, the Syndication Agent, any Lender
or any Issuing Bank be obligated or required to return
any materials furnished by the Borrowers; provided, that
each offeree shall be required to agree that if it does
not become an assignee or participant it shall return all
materials furnished to it by the Borrowers in connection
herewith.
13.21. Judgment Currency. (a) If for the
purposes of obtaining judgment in any court it is
necessary to convert a sum due hereunder or under the
Notes in any currency (the "Original Currency") into
another currency (the "Other Currency") the parties
hereto agree, to the fullest extent that they may
effectively do so, that the rate of exchange used shall
be that at which in accordance with normal banking
procedures the Administrative Agent could purchase the
Original Currency with the Other Currency at 11:00 a.m.
in New York, New York on the second Business Day
preceding that on which final judgment is given.
(b) The obligation of any Borrower in respect
of any sum due in the Original Currency from it to any
Lender or the Administrative Agent hereunder or under the
Note held by such Lender shall, notwithstanding any
judgment in any Other Currency, be discharged only to the
extent that on the Business Day following receipt by such
Lender or the Administrative Agent (as the case may be)
of any sum adjudged to be so due in such Other Currency
such Lender or the Administrative Agent (as the case may
be) may in accordance with normal banking procedures
purchase Dollars with such Other Currency; if the amount
of the Original Currency so purchased is less than the
sum originally due to such Lender or the Administrative
Agent (as the case may be) in the Original Currency, such
Borrower agrees, as a separate obligation and
notwithstanding any such judgment, to indemnify such
Lender or the Administrative Agent (as the case may be)
against such loss, and if the amount of the Original
Currency so purchased exceeds the sum originally due to
any Lender or the Administrative Agent (as the case may
be) in the Original Currency, such Lender or the
Administrative Agent (as the case may be) agrees to remit
to such Borrower such excess.
13.22. Entire Agreement. This Agreement,
taken together with all of the other Loan Documents
embodies the entire agreement and understanding among the
parties hereto and supersedes the commitment letter dated
November 29, 1995 from Citicorp Securities, Inc. and
Credit Suisse and accepted and agreed to by the Borrowers
(except for provisions therein specifically referred to
herein) and all prior agreements and understandings,
written and oral, relating to the subject matter hereof
other than the Confidentiality Agreement dated as of
January 22, 1996 made by Citicorp Securities, Inc. and
Credit Suisse, in favor of the Company and Ciba-Geigy,
which agreement shall survive execution of this Credit
Agreement and by which all the Lenders agree to be bound.
13.23. Termination. Upon the termination in
whole of the Commitments pursuant to the terms of this
Agreement, the Borrowers shall pay to the Administrative
Agent an amount equal to any and all Obligations then
outstanding.
IN WITNESS WHEREOF, this Agreement has been
duly executed as of the date first above written.
HEXCEL CORPORATION
By: /s/ WILLIAM P. MEEHAN
Name: William P. Meehan
Title: Vice President, Chief
Financial Officer and
Treasurer
HEXCEL S.A. (BELGIUM)
By: /s/ WILLIAM P. MEEHAN
Name: William P. Meehan
Title: Director
HEXCEL S.A. (LYON)
By: /s/ WILLIAM P. MEEHAN
Name: William P. Meehan
Title: Director
BROCHIER S.A.
By: /s/ WILLIAM P. MEEHAN
Name: William P. Meehan
Title: Director
HEXCEL (U.K.) LIMITED
By: /s/ STEPHEN C. FORSYTH
Name: Stephen C. Forsyth
Title: Director
COMPOSITE MATERIALS LIMITED
UNITED KINGDOM
By: /s/ WILLIAM HUNT
Name: William Hunt
Title: Director
Notice Address:
Hexcel Corporation
5794 W. Las Positas
Pleasanton, California 94588
Attention: William P. Meehan
Telecopier No. (510) 734-8865
Confirmation No. (510) 847-9500
with a copy to:
Skadden, Arps, Slate, Meagher & Flom
919 Third Avenue
New York, New York 10022
Attention: Peter J. Neckles
Telecopier No. (212) 735-2000
Confirmation No. (212) 735-3000
CITIBANK, N.A., New York branch,
as Lender, Swing Loan Bank, U.S.
Administrative Agent and Issuing
Bank
By: /s/ WILLIAM E. CLARK
Name: William E. Clark
Title: Attorney-in-fact
CITIBANK, N.A., London branch,
as Lender and European Overdraft
Bank
By: /s/ WILLIAM E. CLARK
Name: William E. Clark
Title: Attorney-in-fact
CITIBANK INTERNATIONAL plc, as
European Administrative Agent
By: /s/ STEWART J. HOLMES
Name: Stewart J. Holmes
Title: Vice President
Revolving Credit Commitment
$25,000,000.00
European Overdraft Commitment
$10,000,000.00
Notice Address:
Citibank, N.A., as U.S. Administrative
Agent
One Court Square
7th Floor
Long Island City, New York 11120
Attention: Carmela Caputo
Telecopier No.: (718) 248-4844
Confirmation No.: (718) 248-4477
Citibank International plc, London,
as European Administrative Agent
336 strand
WC2R 1HB
London, England
Attention: Loans Agency
Telecopier No.: 0171 500 4482
Telex: 299831 cibla
Citibank, N.A., as Lender,
Swing Loan Bank and Issuing Bank
399 Park Avenue, 8th Floor
New York, New York 10043
Attention: William E. Clark
Telecopier No.: (212) 793-7460
Confirmation No.: (212) 559-5944
Citibank, N.A., London Branch,
as Lender and European Overdraft Bank
336 strand
WC2R 1HB
London, England
Attention: Loans Agency
Telecopier No.: 0171 500 4482
Telex: 299831 cibla
with a copy to:
Sidley & Austin
875 Third Avenue
New York, New York 10022
Attention: Daniel S. Dokos, Esq.
Telecopier No.: (212) 906-2021
Confirmation No.: (212) 906-2312
Domestic Lending Office:
Citibank, N.A., New York branch
One Court Square, 7th Floor
Long Island City, New York 11120
Attention: Carmela Caputo
Telecopier No.: (718) 248-4844
Confirmation No.: (718) 248-4477
European Lending Office:
Citibank, N.A., London Branch
336 strand
WC2R 1HB
London, England
Attention: Loans Agency
Telecopier No.: 0171 500 4482
Telex: 299831 cibla
CREDIT SUISSE, as Syndication
Agent and Lender
By: /s/ KARL STUDER
Name: Karl Studer
Title: Member of Senior Management
By: /s/ DANIELA HESS
Name: Daniela Hess
Title: Associate
Revolving Credit Commitment
$30,000,000.00
Notice Address:
Karl Studer
Credit Suisse
12 East 49th Street
New York, New York 10017
Domestic Lending Office:
Credit Suisse
12 East 49th Street
New York, New York 10017
Attn: Swiss Client Group
European Lending Office:
Credit Suisse
Five Cabot Square
London E14 4QR
Attn: Client Services Unit
BANQUE NATIONALE DE PARIS,
San Francisco Branch
By: /s/ KATHERINE WOLFE
Name: Katherine Wolfe
Title: Vice President
By: /s/ DEBRA HERMSMEYER
Name: Debra Hermsmeyer
Title: Vice President
Revolving Credit Commitment
$27,500,000.00
Notice Address:
Katherine Wolfe, VP, Corporate Banking
Banque Nationale de Paris,
San Francisco Branch
180 Montgomery Street
San Francisco, CA 94104
Domestic Lending Office:
Katherine Wolfe, VP, Corporate Banking
Banque Nationale de Paris,
San Francisco Branch
180 Montgomery Street
San Francisco, CA 94104
European Lending Office:
Banque Nationale de Paris,
Georgetown Branch
c/o Katherine Wolfe, VP, Corporate Banking
Banque Nationale de Paris,
San Francisco Branch
180 Montgomery Street
San Francisco, CA 94104
THE CHASE MANHATTAN BANK, N.A.
By: /s/ ROGER F. LIEBLICH
Name: Roger F. Lieblich
Title: Managing Director
Revolving Credit Commitment
$27,500,000.00
Notice Address:
Roger F. Lieblich
Global Chemical & Related
Industries Group
The Chase Manhattan Bank, N.A.
One Chase Manhattan Plaza, 4th Fl.
New York, New York 10081
Domestic Lending Office:
Ida Borotto
The Chase Manhattan Bank, N.A.
New York International Banking Facility (IBF)
c/o Eurocurrency Operations Division
4 Chase Metrotech Center - 15th Fl.
Brooklyn, New York 11245
European Lending Office:
Ida Borotto
The Chase Manhattan Bank, N.A.
New York International Banking Facility (IBF)
c/o Eurocurrency Operations Division
4 Chase Metrotech Center - 15th Fl.
Brooklyn, New York 11245
SWISS BANK CORPORATION, New York
and Cayman Islands Branches
By: /s/ HANNO HUBER
Name: Hanno Huber
Title: Associate Director
By: /s/ GUIDO SCHULER
Name: Guido Schuler
Title: Executive Director
Revolving Credit Commitment
$27,500,000.00
Notice Address:
Hanno Huber
Swiss Bank Corporation
222 Broadway
New York, New York 10038
Domestic Lending Office:
Hanno Huber
Swiss Bank Corporation
222 Broadway
New York, New York 10038
European Lending Office:
Hanno Huber
Swiss Bank Corporation
222 Broadway
New York, New York 10038
UNION BANK OF SWITZERLAND,
New York Branch
By: /s/ C.C. GLOCKLER
Name: C.C. Glockler
Title: Vice President
By: /s/ DOUGLAS EDWARDS
Name: Douglas Edwards
Title: Vice President-
Corporate Banking
Revolving Credit Commitment
$27,500,000.00
Notice Address:
Chris Glockler/CAFM
Telecopy No.: (212) 821-3878
Union Bank of Switzerland
299 Park Avenue, 33rd Floor
New York, New York 10171
cc: European Lending Office
Domestic Lending Office:
Chris Glockler/CAFM
Telecopy No.: (212) 821-3878
cc: James Broadus/CADM
Telecopy No.: (212) 821-3259
Union Bank of Switzerland
299 Park Avenue
New York, New York 10171
European Lending Office:
Mark Vincent
Telecopy No.: 011-44-171-901-3903
Union Bank of Switzerland,
London Branch
100 Liverpool Street
London EC2M 2RH
cc: Domestic Lending Office
EXHIBIT A
TO
CREDIT AGREEMENT
DATED AS OF FEBRUARY 29, 1996
Form of Assignment and Acceptance
ASSIGNMENT AND ACCEPTANCE
ASSIGNMENT AND ACCEPTANCE dated ____________ __,
199_, between _______________________ (the "Assignor")
and __________________________ (the "Assignee").
PRELIMINARY STATEMENTS
A. Reference is made to the Credit Agreement dated
as of February 29, 1996, (as amended, supplemented or
otherwise modified from time to time, the "Credit
Agreement") among Hexcel Corporation (the "Company"),
Hexcel S.A. (Belgium), Hexcel (U.K.) Limited, Composite
Materials Limited United Kingdom, Hexcel S.A. (Lyon) and
Brochier S.A. (each, a "Borrower" and, collectively and
together with their respective successors and permitted
assigns, the "Borrowers"), the institutions from time to
time party thereto as lenders (the "Lenders"), the
institutions from time to time party thereto as issuing
banks (the "Issuing Banks"), Citibank N.A., in its
separate capacity as U.S. administrative agent for the
Lenders and Issuing Banks (in such capacity, the "U.S.
Administrative Agent"), Citibank International plc, in
its separate capacity as European administrative agent
for the Lenders and Issuing Banks (in such capacity, the
European Administrative Agent and, together with the
U.S. Administrative Agent, the Administrative Agent ),
and Credit Suisse, in its capacity as syndication agent
for the Lenders and Issuing Banks (in such capacity, the
"Syndication Agent"). Terms defined in the Credit
Agreement and not otherwise defined herein are used
herein with the meanings ascribed thereto in the Credit
Agreement.
B. The Assignor is a Lender under the Credit
Agreement and desires to sell and assign to the Assignee,
and the Assignee desires to purchase and assume from the
Assignor, on the terms and conditions set forth below, a
___ percent (____%) interest in the aggregate Revolving
Credit Commitments (the "Assigned Percentage"), together
with the Assignor's rights and obligations under the
Credit Agreement with respect to the Assigned Percentage.
NOW, THEREFORE, the Assignor and the Assignee hereby
agree as follows:
1. In consideration of the Assignee's payment to
the Assignor of $_______________, the Assignor hereby
sells and assigns to the Assignee, and the Assignee
hereby purchases and assumes from the Assignor, the
Assigned Percentage, together with the Assignor's rights
and obligations under the Credit Agreement with respect
to such Assigned Percentage, including, without
limitation, the obligation to make Revolving Loans and to
participate in Letters of Credit.
2. The Assignor (i) represents and warrants that as
of the date hereof its Revolving Credit Pro Rata Share
(without giving effect to assignments thereof which have
not yet become effective) is ____% and that such
Revolving Credit Pro Rata Share multiplied by the
aggregate Revolving Credit Commitments is equal to
$_____________; (ii) represents and warrants that it has
legal and beneficial title to the interests being
assigned by it hereunder free and clear of any claim
adverse to such title; (iii) makes no representation or
warranty and assumes no responsibility with respect to
any statements, warranties or representations made in or
in connection with the Credit Agreement or the execution,
legality, validity, enforceability, genuineness,
sufficiency or value of the Credit Agreement, any of the
other Loan Documents, or any other instrument or document
furnished pursuant thereto or executed and delivered in
connection therewith; (iv) makes no representation or
warranty and assumes no responsibility with respect to
the financial condition of any Borrower or any of such
Borrower's Subsidiaries or the performance or observance
by any Borrower or any of such Borrower's Subsidiaries of
any of such Persons' respective obligations under the
Credit Agreement, any other Loan Document or any
instrument or document furnished pursuant thereto; and
(v) attaches the Revolving Loan Note delivered to it
under the Credit Agreement and has requested that the
Borrowers exchange such Note for the following new
Note(s):
Revolving Loan Revolving Loan
Note Payable Note Amount:
to the Order of:
[Name of Assignor] $_________
[Name of Assignee] $_________
3. The Assignee (i) represents and warrants that it
is legally authorized to enter into this Assignment and
Acceptance; (ii) confirms that it has received a copy of
the Credit Agreement, together with copies of such other
Loan Documents, information, exhibits, reports,
projections and forecasts that the Assignee has deemed
appropriate to make its own credit analysis and decision
to enter into this Assignment and Acceptance; (iii)
agrees that it shall have no recourse against the
Assignor with respect to any matters relating to the
Credit Agreement, any other Loan Document or this
Assignment and Acceptance (except with respect to the
representations and warranties made by the Assignor in
clauses (i) and (ii) of paragraph 2 above); (iv) agrees
that it will, independently and without reliance upon the
Administrative Agent, the Syndication Agent, any Issuing
Bank, the Assignor or any other Lender and based on such
documents and information as it shall deem appropriate at
the time, continue to make its own credit decisions in
taking or not taking action under the Credit Agreement
and the other Loan Documents; (v) appoints and authorizes
the Administrative Agent to take such action as
administrative agent on its behalf and to exercise such
powers under the Credit Agreement and the other Loan
Documents as are delegated to the Administrative Agent,
by the terms thereof, together with such powers as are
reasonably incidental thereto; (vi) agrees that it will
perform in accordance with their terms all of the
obligations which by the terms of the Credit Agreement
and other Loan Documents are required to be performed by
it as a Lender; (vii) confirms that it is an Eligible
Assignee; and (viii) specifies as its address for notices
the address set forth beneath its name on the signature
page hereof, together with the name and address of its
U.S. Lending Office and its European Lending Office.
4. The effective date for this Assignment and
Acceptance shall be ___________ __, 199_ (the "Effective
Date").(1) Following the execution of this Assignment
and Acceptance, it will be delivered to the
Administrative Agent for acceptance by the Administrative
Agent and for recording in the Register by the
Administrative Agent, together with a processing and
recordation fee of $3,000 to be paid to the
Administrative Agent by the [Assignor][Assignee](2).
5. As of the Effective Date, provided that each of
the Administrative Agent accepts this Assignment and
Acceptance and the Company accepts the Assignee pursuant
to the terms of Section 13.01(b) of the Credit Agreement,
(i) the Assignee shall be a party to the Credit Agreement
and, to the extent provided in this Assignment and
Acceptance, have the rights and obligations of a Lender
thereunder and (ii) the Assignor shall relinquish its
rights and be released from its obligations under the
Credit Agreement with respect to the Assigned Percentage.
6. From and after the Effective Date, provided that
the Administrative Agent accepts this Assignment and
Acceptance, the Administrative Agent shall make all
payments under the Credit Agreement in respect of the
Assigned Percentage (including, without limitation, all
payments of principal, interest and fees with respect
thereto) to the Assignee. The Assignor and Assignee
shall make all appropriate adjustments in payments under
the Credit Agreement for periods prior to the Effective
Date directly between themselves.
7. This Assignment and Acceptance shall be governed
by, and construed in accordance with, the laws of the
State of New York.
_____________________
1 Such date shall be at least two (2) Business Days
after the date of execution of this Assignment and
Acceptance by the Assignor and Assignee.
2 Insert applicable selection.
IN WITNESS WHEREOF, intending to be legally
bound, each of the undersigned has caused this Assignment
and Acceptance to be executed on its behalf by its
officer thereunto duly authorized, as of _________ __,
199_.
[NAME OF ASSIGNOR]
By______________________________
Name:_________________________
Title:________________________
New Revolving Credit Pro Rata
Share _______%
New Revolving
Credit Commitment $_______
[NAME OF ASSIGNEE]
By______________________________
Name:_________________________
Title:________________________
Notice Address and
U.S. Lending Office:
European Lending Office:
Revolving Credit Pro Rata
Share _______%
Revolving Credit
Commitment $_______
Agreed to and accepted this __
day of __________, 199_
CITIBANK, N.A., as Administrative Agent
By____________________________
Title:
___________________, as Borrower
By____________________________
Title:
EXHIBIT B
TO
CREDIT AGREEMENT
DATED AS OF FEBRUARY 29, 1996
Form of Notice of Borrowing
NOTICE OF BORROWING
To: [Citibank, N.A., in its capacity as U.S.
administrative agent (with its successors in such
capacities, the "U.S. Administrative Agent") for the
Lenders (as defined below) and the Issuing Banks (as
defined below)][Citibank International plc, in its
capacity as European administrative agent for the
Lenders and Issuing Banks (in such capacity, the
"European Administrative Agent" and, together with
the U.S. Administrative Agent, the "Administrative
Agent")] under the Credit Agreement dated as of
February 29, 1996 (as amended, restated,
supplemented or otherwise modified from time to
time, the "Credit Agreement") among Hexcel
Corporation, Hexcel S.A. (Belgium), Hexcel (U.K.)
Limited, Composite Materials Limited United Kingdom,
Hexcel S.A. (Lyon), and Brochier S.A., as borrowers,
the financial institutions from time to time party
thereto as Lenders (the "Lenders"), the financial
institutions from time to time party thereto as
Issuing Banks (the "Issuing Banks"), the U.S.
Administrative Agent, the European Administrative
Agent and Credit Suisse, in its capacity as
syndication agent for the Lenders and Issuing Banks.
Pursuant to [Section 2.01(b)](1)[Section 2.02(b)](2)
of the Credit Agreement, this Notice of Borrowing
("Notice") represents the request of the undersigned
Borrower (the "Borrower") to borrow on [the date hereof]
[_______________, 199__ ](the "Funding Date")(3) from the
Lenders
_____________________
1 To be used for a requested Borrowing of Revolving
Loans.
2 To be used for a requested Borrowing of Swing Loans.
3 For Borrowings after the Closing Date, a Notice of
Borrowing must be given (a) in the case of Base Rate
Loans denominated in Dollars, no later than 11:00 a.m.
(New York time) on the proposed Funding Date, (b) in the
case of Eurocurrency Rate Loans (whether denominated in
Dollars or in an Optional Currency), no later than 11:00
a.m. (London time) at least three (3) Business Days in
advance of the proposed Funding Date, and (c) in the case
of Swing Loans, no later than 12:30 p.m. (New York time)
on the proposed Funding Date. The Funding Date must be a
Business Day.
[the principal amount of $ _______________][the
principal amount of _______________ in the lawful
currency of [Austria][Belgium][France][Germany][the
Netherlands][the United Kingdom]] in Revolving Loans
as [Base Rate Loans][Eurocurrency Rate Loans]. In
the event that such Revolving Loans are Eurocurrency
Rate Loans, the Interest Period for such
Eurocurrency Rate Loans is requested to be a [seven
day period (if readily available by all the
Lenders)] [one][two][three][six] month period.]
[the principal amount of $ ________________ in Swing
Loans as Base Rate Loans [or, in the event that the
Administrative Agent determines in its sole
discretion pursuant to Section 2.02(b) of the Credit
Agreement that a Borrowing of Swing Loans is not
possible or feasible, in Revolving Loans as Base
Rate Loans.]]
Proceeds of such Loans are to be deposited on the
Funding Date into the Borrower's disbursement account
number __________ maintained at the office of __________.
The Borrower certifies that as of the Funding Date
all of the conditions precedent contained in [Section
5.01 of the Credit Agreement](4)[Section 5.02 of the
Credit Agreement](5) have been satisfied (or waived
pursuant to Section 13.07 of the Credit Agreement).
Unless otherwise defined herein, terms defined
in the Credit Agreement shall have the same meanings in
this Notice.
Dated this ___ day of ___________, 199_.
[Name of Borrower]
By:
Name:
Title:
__________________
4 To be used for Revolving Loans to be made on the
Closing Date. All Revolving Loans made on the Closing
Date shall be Base Rate Loans.
5 To be used for Revolving Loans and Swing Loans to be
made after the Closing Date.
EXHIBIT C
TO
CREDIT AGREEMENT
DATED AS OF FEBRUARY 29, 1996
Form of Notice of Conversion/Continuation
To: [Citibank, N.A., in its capacity as U.S.
administrative agent (with its successors in such
capacities, the "U.S. Administrative Agent") for the
Lenders (as defined below) and the Issuing Banks (as
defined below)][Citibank International plc, in its
capacity as European administrative agent for the
Lenders and Issuing Banks (in such capacity, the
"European Administrative Agent" and, together with
the U.S. Administrative Agent, the "Administrative
Agent")] under the Credit Agreement dated as of
February 29, 1996 (as amended, restated,
supplemented or otherwise modified from time to
time, the "Credit Agreement") among Hexcel
Corporation, Hexcel S.A. (Belgium), Hexcel (U.K.)
Limited, Composite Materials Limited United Kingdom,
Hexcel S.A. (Lyon), and Brochier S.A., as borrowers,
the financial institutions from time to time party
thereto as Lenders (the "Lenders"), the financial
institutions from time to time party thereto as
Issuing Banks (the "Issuing Banks"), the U.S.
Administrative Agent, the European Administrative
Agent and Credit Suisse, in its capacity as
syndication agent for the Lenders and Issuing Banks.
Pursuant to Section 4.01(c)(ii) of the Credit
Agreement, this Notice of Conversion/Continuation
("Notice") represents the election of the undersigned
Borrower (the "Borrower") to
[Convert $____________(1) in aggregate principal
amount of Revolving Loans consisting of Base Rate
Loans from Base Rate Loans to Eurocurrency Rate
Loans denominated in the same currency on
________________, 199_.(2) The initial Interest
Period for such Eurocurrency Rate Loans is requested
to be a [seven day period (if readily available by
all the Lenders)] [one][two][three][six] month
period.]
[Convert $_____________ in aggregate principal
amount of outstanding Eurocurrency Rate Loans to
_____________________
1 Must be in a principal amount of at least $1,000,000
and in integral multiples of $1,000,000 in excess of that
amount.
2 Must be a Business Day at least three (3) Business
Days following the Business Day on which the Notice of
Conversion/Continuation is delivered to the
Administrative Agent.
Base Rate Loans denominated in the same currency on
____________, 199__.(3)]
[Continue as Eurocurrency Rate Loans
$_______________(4) in aggregate principal amount
of Revolving Loans consisting of Eurocurrency Rate
Loans denominated in the same currency with a
current Interest Period ending _______________,
199_. The succeeding Interest Period for such
Eurocurrency Rate Loans is requested to be a
[one][two][three][six] month period.]
The Borrower hereby certifies that (i) the proposed
[continuation][conversion] would not violate any
provisions of Section 4.02 of the Credit Agreement and,
as a result thereof, (ii) no Default or Event of Default
would occur or has occurred and is continuing under the
Credit Agreement.
____________________
3 Must be the date of expiration of the relevant
Eurodollar Interest Periods.
4 Must be in a principal amount of at least $1,000,000
and in integral multiples of $1,000,000 in excess of that
amount.
Unless otherwise defined herein, terms defined in
the Credit Agreement shall have the same meanings in this
Notice.
Dated this ___ day of ________, 199_.
[Name of Borrower]
By:________________________
Name:
Title:
EXHIBIT D
TO
CREDIT AGREEMENT
DATED AS OF FEBRUARY 29, 1996
$165,000,000
SENIOR SECURED REVOLVING CREDIT FACILITY
and
$10,000,000
SENIOR SECURED EUROPEAN OVERDRAFT FACILITY
to
HEXCEL CORPORATION
HEXCEL S.A. (BELGIUM)
HEXCEL (U.K.) LIMITED
COMPOSITE MATERIALS LIMITED UNITED KINGDOM
HEXCEL S.A. (LYON)
BROCHIER S.A.
February 29, 1996
LIST OF CLOSING DOCUMENTS(1)
A. Loan Documents (a) CREDIT AGREEMENT, dated as
of February 29, 1996 (the "Credit Agreement") among
Hexcel Corporation (the "Company"), Hexcel S.A. ("Hexcel
Belgium"), Hexcel (U.K.) Limited ("Hexcel U.K."),
Composite Materials Limited United Kingdom ("CML"),
Hexcel S.A. ("Hexcel Lyon") and Brochier S.A.
("Brochier")(collectively, the "Borrowers"), the
institutions from time to time party thereto as lenders
(the "Lenders"), the institutions from time to time party
thereto as issuing banks (the "Issuing Banks"), Citibank,
N.A., in its capacity as administrative agent for the
Lenders and Issuing Banks (in such capacity, the "U.S.
Administrative Agent"), Citibank International plc, in
its capacity as European administrative agent for the
Lenders and Issuing Banks (in such capacity, the
"European Administrative Agent" and, together with the
U.S. Administrative Agent, the "Administrative Agent")
and Credit Suisse, in its capacity as syndication agent
for the Lenders and Issuing Banks (in such capacity, the
"Syndication Agent"), evidencing a senior secured
revolving credit facility to be made available to the
Borrowers of up to $165,000,000 and a senior secured
European Overdraft Facility to be made available to the
Foreign Borrowers of up to $10,000,000, with the Exhibits
and Schedules listed below attached thereto:
EXHIBITS
Exhibit A -- Form of Assignment and Acceptance
Exhibit B -- Form of Notice of Borrowing
Exhibit C -- Form of Notice of Conversion/Continuation
_____________________
1 Capitalized terms used herein have the meanings
ascribed to them in the Credit Agreement.
Exhibit D -- List of Closing Documents
Exhibit E -- Form of Officer's Certificate to Accompany
Reports
Exhibit F -- Form of Revolving Loan Note
Exhibit G -- Form of Swing Loan Note
Exhibit H -- Form of Company Guaranty
Exhibit I -- Form of Domestic Subsidiary Guaranty
Exhibit J -- Form of Company Pledge Agreement
Exhibit K -- Form of European Overdraft Note
Exhibit L -- Form of Borrower Addendum
Exhibit M -- Form of Connecticut Counsel Opinion
SCHEDULES
Schedule 1.01.2 -- Administrative Agent s European Accounts
Schedule 1.01.3 -- Permitted Existing Accommodation Obligations
Schedule 1.01.4 -- Permitted Existing Indebtedness
Schedule 1.01.5 -- Permitted Existing Investments
Schedule 1.01.6 -- Permitted Existing Liens
Schedule 1.01.7 -- Existing Industrial Revenue Development Bonds
Schedule 2.04(k) -- Existing Transitional Letters of Credit
Schedule 6.01-C -- Authorized, Issued and Outstanding Capital
Stock; Subsidiaries
Schedule 6.01-D -- Conflicts with Contractual Obligations and
Requirements of Law
Schedule 6.01-F -- Governmental Consents
Schedule 6.01-H -- Litigation; Adverse Effects
Schedule 6.01-I -- Taxes
Schedule 6.01-L -- Requirements of Law
Schedule 6.01-M -- Environmental Matters
Schedule 6.01-N -- ERISA Matters
Schedule 6.01-O -- Foreign Pension Plan Claims
Schedule 6.01-P -- Labor Matters
Schedule 6.01-T -- Government Contracts
Schedule 9.02 -- Properties to be Sold
Schedule 9.04 -- Investments made in Connection with
the Acquisition
Schedule 9.08 -- Transactions with Affiliates
Schedule 9.13 -- Management Incentive Plans
1. REVOLVING LOAN NOTES made by the Company in
favor of the Lenders in the aggregate principal amount of
$165,000,000 evidencing the Company s obligation to repay
Revolving Loans.
2. REVOLVING LOAN NOTES made by each Foreign
Borrower set forth below in favor of the Lenders in the
aggregate principal Dollar amount of $165,000,000,
evidencing such Foreign Borrower s obligation to repay
Revolving Loans:
a. Hexcel Belgium
b. Hexcel U.K.
c. CML
d. Hexcel Lyon
e. Brochier
3. SWING LOAN NOTE made by the Company in
favor of Citibank N.A., as the Swing Loan Bank, in the
principal amount of $10,000,000 evidencing the Company s
obligation to repay Swing Loans.
4. EUROPEAN OVERDRAFT NOTES made by each
Foreign Borrower in favor of Citibank, N.A., as the
European Overdraft Bank, each in the prinicpal amount of
$10,000,000 evidencing such Foreign Borrower s obligation
to repay European Overdraft Loans.
5. NOTICE OF BORROWING delivered prior to the
Closing Date.
6. COMPANY GUARANTY made by the Company in
favor of the U.S. Administrative Agent, the European
Administrative Agent, the Lenders, the Issuing Banks and
the Syndication Agent, pursuant to which the Company
guarantees the Obligations of the Foreign Borrowers.
7. DOMESTIC SUBSIDIARY GUARANTY made by each
of the Domestic Subsidiaries of the Company (other than
Hexcel Alpha Corporation) in favor of the U.S.
Administrative Agent, the European Administrative Agent,
the Lenders, the Issuing Banks and the Syndication Agent,
pursuant to which each of the Domestic Subsidiaries
guarantees the Obligations of the Company and each of the
Foreign Borrowers.
8. FOREIGN SUBSIDIARY GUARANTIES made by each
of the Foreign Subsidiaries of the Company set forth
below in favor of the U.S. Administrative Agent, the
European Administrative Agent, the Lenders, the Issuing
Banks and the Syndication Agent, pursuant to which each
such Foreign Subsidiary guarantees the Obligations of
each of the Foreign Borrowers (other than such Foreign
Subsidiary, if such Foreign Subsidiary is a Foreign
Borrower, and other than the Obligations of any such
Foreign Borrower as parent in respect of any Acquisition
Loan owing by such parent).
a. Hexcel Belgium
b. Hexcel U.K.
c. CML
d. Hexcel Lyon
e. Brochier
9. SECOND AMENDED AND RESTATED REIMBURSEMENT
AGREEMENT dated as of February 29, 1996 between Hexcel
Corporation and Banque Nationale de Paris ( "BNP" ).
B. Security Documents
10. COMPANY PLEDGE AGREEMENT executed by the
Company in favor of the Administrative Agent evidencing
the pledge by the Company of all the issued and
outstanding Capital Stock of each of the Domestic
Subsidiaries (other than Hexcel Alpha Corporation and
Hexcel Technologies, Inc.) owned by it, together with the
stock certificates and appropriate stock powers undated
and endorsed in blank.
11. BELGIAN PLEDGE AGREEMENT executed by the
Company in favor of the Administrative Agent (the
"Belgian Pledge Agreement") evidencing the pledge by the
Company of (i) 65% of the issued and outstanding Capital
Stock of Hexcel Belgium as security for the Obligations
of the Company other than Obligations in respect of the
Company Guaranty and (ii) 100% of the issued and
outstanding Capital Stock of Hexcel Belgium as security
for the Obligations of the Company in respect of the
Company Guaranty, together, in each case, with the stock
certificates.
12. ENGLISH PLEDGE AGREEMENT (HEXCEL U.K.)
executed by the Company and Hexcel U.K. in favor of the
Administrative Agent (the "English Pledge Agreement
(Hexcel U.K.)") evidencing (a) the pledge by the Company
of (i) 65% of the issued and outstanding Capital Stock of
Hexcel U.K. as security for the Obligations of the
Company other than Obligations in respect of the Company
Guaranty and (ii) 100% of the issued and outstanding
Capital Stock of Hexcel U.K. as security for the
Obligations of the Company in respect of the Company
Guaranty, together, in each case, with the share
certificates and appropriate share transfer forms undated
and endorsed in blank and a certified copy of the
Register of Members, and (b) the undertaking by the
Company and Hexcel U.K. that, upon registration of Hexcel
U.K. as a member of CML with respect to any shares of
Capital Stock of CML, Hexcel U.K. will pledge such shares
as security for the Obligations of Hexcel U.K.
13. FRENCH PLEDGE AGREEMENT (HEXCEL LYON)
executed by the Company in favor of the Administrative
Agent (the "French Pledge Agreement (Hexcel Lyon)")
evidencing the pledge by the Company of (i) 65% of the
issued and outstanding Capital Stock of Hexcel Lyon as
security for the Obligations of the Company other than
Obligations in respect of the Company Guaranty and (ii)
100% of the issued and outstanding Capital Stock of
Hexcel Lyon owned by the Company as security for the
Obligations of the Company in respect of the Company
Guaranty, together with a notice of pledge.
14. FRENCH PLEDGE AGREEMENT (BROCHIER)
executed by Hexcel Lyon in favor of the Administrative
Agent (the "French Pledge Agreement (Brochier)")
evidencing the pledge by Hexcel Lyon of 100% of the
issued and outstanding Capital Stock of Brochier owned by
Hexcel Lyon as security for the Obligations of Hexcel
Lyon, together with a notice of pledge.
15. FRENCH PLEDGE AGREEMENTS (CDSR) executed
by each of the Foreign Subsidiaries of the Company set
forth below in favor of the Administrative Agent (each, a
"French Pledge Agreement (CDSR)") evidencing the pledge
by such Foreign Subsidiary of 100% of the issued and
outstanding Capital Stock of Confection et Diffusion des
Stores et Rideaux ("CDSR") owned by such Foreign
Subsidiary as security for the Obligations of such
Foreign Subsidiary, together, in each case, with a notice
of pledge.
a. Hexcel Lyon
b. Brochier
16. ITALIAN PLEDGE AGREEMENT executed by the
Company in favor of the Administrative Agent (the
"Italian Pledge Agreement") evidencing the pledge by the
Company of (i) 65% of the issued and outstanding Capital
Stock of Salver S.r.l. ( Salver ) as security for the
Obligations of the Company other than Obligations in
respect of the Company Guaranty and (ii) 100% of the
issued and outstanding Capital Stock of Salver as
security for the Obligations of the Company in respect of
the Company Guaranty, together, in each case, with the
stock certificates and appropriate stock powers undated
and endorsed in blank.
17. COLLATERAL AGENCY AGREEMENT between the
U.S. Administrative Agent and the Company, relating to
the pledge by the Company of stock of Hexcel Pottsville
Corporation.
18. UCC LIEN, TAX LIEN AND JUDGMENT SEARCH
REPORTS of filings against the Company and each Domestic
Subsidiary in the offices set forth with respect to each
such entity on Schedule I hereto.
19. UCC-1 FINANCING STATEMENTS filed against
the Company in connection with the Company Pledge
Agreement with (i) the Secretary of State of Connecticut
and (ii) the Secretary of State of California.
C. Corporate Documents
20. CERTIFICATE OF INCORPORATION OF THE
COMPANY together with all amendments thereto certified by
the Secretary of State of Delaware.
21. CERTIFICATE OF INCORPORATION of each
Domestic Subsidiary (other than Hexcel Alpha
Corporation), together with all amendments thereto
certified by the Secretary of State of the jurisdiction
or incorporation of such Domestic Subsidiary.
22. CERTIFICATE OF INCORPORATION (OR
EQUIVALENT) OF EACH FOREIGN SUBSIDIARY, the stock of
which is being pledged to the Administrative Agent
pursuant to the Loan Documents, together with all
amendments thereto, certified, if applicable, by the
appropriate Governmental Authority from the jurisdiction
in which such Foreign Subsidiary is incorporated.
23. GOOD STANDING CERTIFICATES FOR THE COMPANY
from the appropriate offices of the states set forth on
Schedule II hereto under the heading "Company Good
Standing Certificates".
24. GOOD STANDING CERTIFICATES FOR EACH
DOMESTIC SUBSIDIARY (other than Hexcel Alpha Corporation)
from the appropriate offices of the states set forth on
Schedule II hereto under the heading "Domestic Subsidiary
Good Standing Certificates".
25. GOOD STANDING CERTIFICATES (OR EQUIVALENT)
FOR EACH FOREIGN BORROWER, if applicable, from the office
of the appropriate Governmental Authorities.
26. CERTIFICATE OF THE SECRETARY OF THE
COMPANY, certifying, among other things, (i) resolutions
of the Board of Directors of the Company authorizing,
among other things, the execution, delivery and
performance of the Credit Agreement, the Notes and the
other Loan Documents to which it is a party and the
Transaction Documents to which it is a party, (ii) the
names and signatures of the officers of the Company
authorized, on behalf of the Company, to execute the
Credit Agreement, the Notes, the other Loan Documents and
Transaction Documents to which it is a party and the
other instruments and documents to be executed and
delivered on behalf of the Company during the term of the
Credit Agreement, (iii) that the copies of the
Transaction Documents to which it is a party delivered to
the Administrative Agent and the Lenders pursuant to the
Credit Agreement are true and correct copies of such
documents and such documents have not been amended from
the form of such documents delivered pursuant thereto,
(iv) that attached thereto is a true and correct copy of
the By-laws of the Company as in effect on the date of
such certification and (v) that there have been no
changes in the Certificate of Incorporation of the
Company since the date of the most recent certification
thereof by the Secretary of State of Delaware.
27. CERTIFICATE OF THE SECRETARY OF EACH
DOMESTIC SUBSIDIARY, certifying, among other things,
(i) resolutions of the Board of Directors of such
Domestic Subsidiary authorizing, among other things, the
execution, delivery and performance of the Domestic
Subsidiary Guaranty and the other Loan Documents to which
it is a party and the Transaction Documents to which it
is a party, (ii) the names and signatures of the officers
of such Domestic Subsidiary authorized, on behalf of such
Domestic Subsidiary, to execute the Domestic Subsidiary
Guaranty, the other Loan Documents and Transaction
Documents to which it is a party and the other
instruments and documents to be executed and delivered on
behalf of such Domestic Subsidiary during the term of the
Credit Agreement, (iii) that the copies of the
Transaction Documents to which it is a party delivered to
the Administrative Agent and the Lenders pursuant to the
Credit Agreement are true and correct copies of such
documents and such documents have not been amended from
the form of such documents delivered pursuant thereto,
(iv) that attached thereto is a true and correct copy of
the By-laws of such Domestic Subsidiary as in effect on
the date of such certification and (v) that there have
been no changes in the Certificate of Incorporation of
such Domestic Subsidiary since the date of the most
recent certification thereof by the Secretary of State of
its state of incorporation.
28. CERTIFICATE OF THE SECRETARY (OR
EQUIVALENT) OF EACH FOREIGN SUBSIDIARY set forth below,
certifying, among other things, (i) resolutions of the
Board of Directors (or, in the case of Hexcel Belgium, of
the shareholders) of such Foreign Subsidiary authorizing,
among other things, the execution, delivery and
performance of the (a) Foreign Subsidiary Guaranty made
by such Foreign Subsidiary, (b) in the case of Hexcel
Lyon, the French Pledge Agreement (Brochier) and a French
Pledge Agreement (CDSR), and in the case of Brochier, a
French Pledge Agreement (CDSR), and (c) the other Loan
Documents to which it is a party and the Transaction
Documents to which it is a party, (ii) the names and
signatures of the officers of such Foreign Subsidiary
authorized, on behalf of such Foreign Subsidiary, to
execute the Foreign Subsidiary Guaranty, the other Loan
Documents and Transaction Documents to which it is a
party and the other instruments and documents to be
executed and delivered on behalf of such Foreign
Subsidiary during the term of the Credit Agreement, (iii)
that the copies of the Transaction Documents to which it
is a party delivered to the Administrative Agent and the
Lenders pursuant to the Credit Agreement are true and
correct copies of such documents and such documents have
not been amended from the form of such documents
delivered pursuant thereto, (iv) that attached thereto is
a true and correct copy of the By-laws (or equivalent) of
such Foreign Subsidiary as in effect on the date of such
certification and (v) that there have been no changes in
the Certificate of Incorporation (or equivalent) of such
Foreign Subsidiary since the date of the most recent
certification thereof by the appropriate Governmental
Authority.
a. Hexcel Belgium
b. Hexcel U.K.
c. CML
d. Hexcel Lyon
e. Brochier
29. SHAREHOLDER CONSENTS OF THE SHAREHOLDERS
OF EACH FOREIGN SUBSIDIARY set forth below, consenting to
the resolutions adopted by the Board of Directors of each
such Foreign Subsidiary.
a. Hexcel U.K.
b. CML
D. Opinions
30. OPINION OF COUNSEL FOR THE COMPANY,
Skadden, Arps, Slate, Meagher & Flom, addressed to the
Lenders, the Issuing Banks, the U.S. Administrative
Agent, the European Administrative Agent and the
Syndication Agent.
31. OPINION OF COUNSEL FOR THE COMPANY,
Kronish, Lieb, Weiner & Hellman, addressed to the
Lenders, the Issuing Banks, the U.S. Administrative
Agent, the European Administrative Agent and the
Syndication Agent.
32. OPINION OF CALIFORNIA COUNSEL FOR THE
COMPANY, Wendel, Rosen, Black & Dean, addressed to the
Lenders, the Issuing Banks, the U.S. Administrative
Agent, the European Administrative Agent and the
Syndication Agent.
33. OPINION OF COUNSEL FOR THE COMPANY,
McFarlin and Anderson, addressed to the Company, BNP, the
Lenders, the Issuing Banks, the U.S. Administrative
Agent, the European Administrative Agent and the
Syndication Agent.
34. OPINION OF COUNSEL FOR HEXCEL POTTSVILLE
CORPORATION, Schneck, Weltman, Hasmall & Mischel,
addressed to Ciba-Geigy Limited and Ciba-Geigy
Corporation (collectively, "Ciba-Geigy"), with a letter
authorizing reliance by the Lenders, the Issuing Banks,
the U.S. Administrative Agent, the European
Administrative Agent and the Syndication Agent.
35. OPINION OF COUNSEL FOR CIBA-GEIGY,
Cravath, Swaine & Moore, addressed to the Company, with a
letter authorizing reliance by the Lenders, the Issuing
Banks, the U.S. Administrative Agent, the European
Administrative Agent and the Syndication Agent.
36. OPINION OF COUNSEL FOR CIBA-GEIGY, Dr.
Peter Rudolph, addressed to the Company, with a letter
authorizing reliance by the Lenders, the Issuing Banks,
the U.S. Administrative Agent, the European
Administrative Agent and the Syndication Agent.
37. OPINION OF FOREIGN COUNSEL FOR THE COMPANY
from each of the foreign counsel of the Company set forth
below, in respect of the pledges of foreign stock,
addressed to the Lenders, the Issuing Banks, the U.S.
Administrative Agent, the European Administrative Agent
and the Syndication Agent:
a. Heller, Loeber, Bahn & Partners (Austria)
b. Hogan & Hartson, L.L.P. (Belgium)
c. Baker & McKenzie (England)
d. Addleshaws Sons & Latham (England)
e. S.G. Archibald (France)
f. Marena, Aghina, Bonvicini & Ludergneni
Italy)
E. Transaction Documents
38. PROXY STATEMENT of Hexcel Corporation
dated as of January 22, 1996.
39. STRATEGIC ALLIANCE AGREEMENT dated as of
September 29, 1995 and amended as of December 12, 1995.
40. GOVERNANCE AGREEMENT dated as of February
29, 1996.
41. RETENTION AGREEMENT dated as of February
29, 1996.
42. SUBORDINATED NOTES INDENTURE dated as of
February 29, 1996, between the Company and First Trust of
California, N.A., as Trustee.
F. Lien Releases
43. LIEN RELEASE AND TERMINATION LETTER
addressed to the Administrative Agent from the Existing
Agent.
44. LIEN RELEASES executed by the Existing
Agent in connection with the pledges by the Company of
the stock of its foreign subsidiaries.
a. Hexcel Belgium
b. Hexcel U.K.
c. Hexcel Lyon
45. SATISFACTION OF MORTGAGE, SECURITY
AGREEMENT, FIXTURE FILING FINANCING STATEMENT AND
ASSIGNMENT OF RENTS AND LEASES, executed by the Existing
Agent in favor of the Company in respect of the Casa
Grande, Arizona property.
46. SATISFACTION OF MORTGAGE, SECURITY
AGREEMENT, FIXTURE FILING FINANCING STATEMENT AND
ASSIGNMENT OF RENTS AND LEASES, executed by the Existing
Agent in favor of the Company in respect of the Livermore
and Dublin, California properties.
47. SATISFACTION OF MORTGAGE, SECURITY
AGREEMENT, FIXTURE FILING FINANCING STATEMENT AND
ASSIGNMENT OF RENTS AND LEASES, executed by the Existing
Agent in favor of the Company in respect of the
Lancaster, Ohio property.
48. SATISFACTION OF MORTGAGE, SECURITY
AGREEMENT, FIXTURE FILING FINANCING STATEMENT AND
ASSIGNMENT OF RENTS AND LEASES, executed by the Existing
Agent in favor of the Company in respect of the
Pottsville, Pennsylvania property.
49. SATISFACTION OF MORTGAGE, SECURITY
AGREEMENT, FIXTURE FILING FINANCING STATEMENT AND
ASSIGNMENT OF RENTS AND LEASES, executed by the Existing
Agent in favor of the Company in respect of the Seguin,
Texas property.
50. SATISFACTION OF LEASEHOLD MORTGAGE,
SECURITY AGREEMENT, FIXTURE FILING FINANCING STATEMENT
AND ASSIGNMENT OF RENTS AND LEASES, executed by the
Existing Agent in favor of the Company in respect of the
Burlington, Washington property.
51. UCC-3 TERMINATION STATEMENTS filed against
the Company and the Domestic Subsidiaries with the
offices set forth on Schedule III hereto.
52. RELEASE OF TRADEMARK SECURITY AGREEMENT
filed against the Company by the Existing Agent.
53. RELEASE OF PATENT SECURITY AGREEMENT filed
against the Company by the Existing Agent.
54. NOTICE OF TERMINATION OF SECURITY INTEREST
delivered to Wells Fargo Bank from the Existing Agent.
G. Miscellaneous
55. PUBLICATION CONSENT executed by the
Company and addressed to the Lenders, the U.S.
Administrative Agent, the European Administrative Agent
and the Syndication Agent.
56. FUNDS FLOW MEMORANDUM executed by the
Company outlining the flow of funds to occur on the
Closing Date for all transactions contemplated in the
Transaction Documents.
57. FUNDING ACCOUNT AGREEMENT providing for
initial funding of Revolving Loans, with attached
Annexes:
a. Form of Notice of Borrowing
b. Form of Disbursement Direction Letter
from a Lender
c. Form of Disbursement Direction Letter
from the Company
58. LETTER FROM PROCESS AGENT accepting the
appointment as the Company's agent in New York,
indicating such Process Agent's fees for the longest
contemplated term of the Credit Agreement have been paid
in full in advance.
59. OFFICER'S CERTIFICATE of the Company
setting forth the names of persons authorized to request
Loans and Letters of Credit.
H. Post-Closing Matters
60. REVOLVING LOAN NOTES made by Danutec
Holdings AG ("Danutec Holdings") and/or Danutec Werkstoff
GmbH ("Danutec Werkstoff") in favor of the Lenders in the
aggregate principal Dollar amount of $165,000,000,
evidencing Danutec Holdings and/or Danutec Werkstoff s
obligation to repay Revolving Loans.
61. AGREEMENT by Danutec Holdings to be bound
by the terms and conditions of the Credit Agreement, to
be executed by Danutec Holdings immediately upon the
formation of Danutec Holdings as an Aktiengesellschaft.
62. FOREIGN SUBSIDIARY GUARANTY made by
Danutec Holdings in favor of the U.S. Administrative
Agent, the European Administrative Agent, the Lenders,
the Issuing Banks and the Syndication Agent, pursuant to
which Danutec Holdings guaranties the Obligations of each
other Foreign Borrower.
63. AUSTRIAN PLEDGE AGREEMENT (DANUTEC
HOLDINGS) executed by Hexcel Far East in favor of the
Administrative Agent (the "Austrian Pledge Agreement
(Danutec Holdings)") evidencing the pledge by Hexcel Far
East of (i) 65% of the issued and outstanding Capital
Stock of Danutec Holdings as security for the Obligations
of Hexcel Far East other than Obligations in respect of
the Foreign Borrowers and (ii) 100% of the issued and
outstanding Capital Stock of Danutec Holdings as security
for the Obligations of Hexcel Far East in respect of the
Foreign Borrowers, together, in each case, with the stock
certificates and appropriate stock powers undated and
endorsed in blank.
64. AGREEMENT by Danutec Werkstoff to be bound
by the terms and conditions of the Credit Agreement, to
be executed by Danutec Werkstoff immediately upon the
acquisition by Hexcel Far East of Danutec Werkstoff.
65. FOREIGN SUBSIDIARY GUARANTY made by
Danutec Werkstoff in favor of the U.S. Administrative
Agent, the European Administrative Agent, the Lenders,
the Issuing Banks and the Syndication Agent, pursuant to
which Danutec Werkstoff guaranties the Obligations of
each other Foreign Borrower.
66. AUSTRIAN PLEDGE AGREEMENT (DANUTEC
WERKSTOFF) executed by Danutec Holdings in favor of the
Administrative Agent (the "Austrian Pledge Agreement
(Danutec Werkstoff)") evidencing the pledge by Danutec
Holdings of 100% of the issued and outstanding Capital
Stock of Danutec Werkstoff as security for the
Obligations of Danutec Holdings, together with the stock
certificates and appropriate stock powers undated and
endorsed in blank.
SCHEDULE I
(to Exhibit D to the Credit Agreement)
HEXCEL CORPORATION
JURISDICTIONS SEARCHED
UCC Lien, Tax Lien and Judgment Search Reports in
the following jurisdictions:
A. Company
Arizona
Secretary of State
Maricopa County
Pinal County
California
Secretary of State
Alameda County
Los Angeles County
Ohio
Secretary of State
Fairfield County
Pennsylvania
Secretary of State
Schuylkill County
Texas
Secretary of State
Tarrant County
Guadalupe County
Young County
Washington
Department of Licensing
Skagit County
B. Company's Domestic Subsidiaries:
HEXCEL ALPHA CORPORATION
California
Secretary of State
Alameda County
Delaware
Secretary of State
HEXCEL BETA CORPORATION
California
Secretary of State
Alameda County
Delaware
Secretary of State
HEXCEL FAR EAST
California
Secretary of State
Alameda County
Delaware
Secretary of State
HEXCEL INTERNATIONAL
California
Secretary of State
Alameda County
Delaware
Secretary of State
HEXCEL POTTSVILLE, INC.
Pennsylvania
Secretary of State
Schuylkill County
HEXCEL TECHNOLOGIES, INC.
California
Secretary of State
Alameda County
Delaware
Secretary of State
C. Ciba-Geigy Composites Business:
California
Secretary of State
Orange County
Washington
Secretary of State
King County
Whatcom County
EXPLANATION:
UCC = UCC-1s, UCC-2s and UCC-3s of Record.
FF = Fixture Filings
TL = State and Federal Tax Liens and Judgments
PSJ = Pending Suits & Judgments
SCHEDULE II
(to Exhibit D to the Credit Agreement)
COMPANY GOOD STANDING CERTIFICATES
Arizona
California
Connecticut
Delaware
Florida
Georgia
Illinois
Massachusetts
Michigan
New Jersey
Ohio
Pennsylvania
Texas
Washington
DOMESTIC SUBSIDIARY GOOD STANDING CERTIFICATES
HEXCEL BETA CORPORATION
Delaware
California
HEXCEL FAR EAST
California
HEXCEL INTERNATIONAL
California
HEXCEL POTTSVILLE CORPORATION
Delaware
Pennsylvania
HEXCEL TECHNOLOGIES, INC.
Delaware
California
SCHEDULE III
(to Exhibit D to the Credit Agreement)
UCC-3 TERMINATION OF FINANCING STATEMENTS FILED AGAINST
THE COMPANY WITH:
a. Arizona
Secretary of State
b. California
Secretary of State
c. Delaware
Secretary of State
d. Georgia
Gwinnett County
e. Indiana
Lake County
f. Ohio
Secretary of State
Fairfield County
g. Pennsylvania
Secretary of State
Schuylkill County
Chester County
h. Texas
Secretary of State
i. Washington
Secretary of State
UCC-3 TERMINATION OF FINANCING STATEMENTS FILED AGAINST
EACH DOMESTIC SUBSIDIARY (OTHER THAN HEXCEL POTTSVILLE
CORPORATION) WITH THE CALIFORNIA SECRETARY OF STATE.
UCC-3 TERMINATION OF FINANCING STATEMENTS FILED AGAINST
HEXCEL FAR EAST, HEXCEL INTERNATIONAL AND HEXCEL
TECHNOLOGIES, INC. WITH THE DELAWARE SECRETARY OF STATE.
EXHIBIT E
TO
CREDIT AGREEMENT
DATED AS OF FEBRUARY 29, 1996
Form of Officer's Certificate to Accompany Reports
OFFICER'S CERTIFICATE
To: Citibank, N.A., in its capacity as U.S.
administrative agent (with its successors in such
capacities, the "Administrative Agent") for the
Lenders (as defined below) and the Issuing Banks (as
defined below) under the Credit Agreement dated as
of February 29, 1996 (as amended, restated,
supplemented or otherwise modified from time to
time, the "Credit Agreement") among Hexcel
Corporation, Hexcel S.A. (Belgium), Hexcel (U.K.)
Limited, Composite Materials Limited United Kingdom,
Hexcel S.A. (Lyon) and Brochier S.A., as borrowers,
the financial institutions from time to time party
thereto as Lenders (the "Lenders"), the financial
institutions from time to time party thereto as
Issuing Banks (the "Issuing Banks"), the
Administrative Agent, Citibank International plc, in
its capacity as European Administrative Agent for
the Lenders and the Issuing Banks, and Credit
Suisse, in its capacity as syndication agent for the
Lenders and Issuing Banks.
Pursuant to Section 7.01(d) of the Credit Agreement,
the Chief Financial Officer of the undersigned, hereby
certifies that:
1. I am the duly elected, qualified and acting [Chief
Financial Officer][Treasurer][Controller] of the
Borrower.
2. Unless otherwise defined herein, terms defined in
the Credit Agreement shall have the same meanings in this
Certificate.
3. There has been a review of the terms of the Loan
Documents and a review in reasonable detail of the
transactions and consolidated and consolidating financial
condition of the Borrower and its Subsidiaries during the
accounting period(s) covered by the financial statements
identified below. Such review [has] [has not] disclosed
the existence during or at the end of such accounting
period, and as at the date hereof the undersigned [does]
[does not] have knowledge, of any condition or event
which constitutes a Default or an Event of Default. [If
such condition or event exists or existed, specify (i)
nature and period of such condition or event and (ii)
action being taken and/or proposed to be taken with
respect thereto.]
4. The financial statements, reports and copies of
certain instruments and documents attached hereto,
namely,
A. _______________, dated _______________
B. _______________, dated _______________
C. _______________, dated _______________
D. _______________, dated _______________
are true, accurate and complete copies of the aforesaid
instruments and documents which constitute part of the
customary books and records of the Borrower.
5. The Compliance Certificate attached as Annex I
hereto demonstrates (a) calculations relating to the
terms of Section 3.01(b) of the Credit Agreement
(including, without limitation, calculations of Net Cash
Proceeds and mandatory prepayments), and (b) compliance
by the Borrowers with the negative covenants of Article
IX of the Credit Agreement and the financial covenants of
Article X of the Credit Agreement.
Dated this ___ day of ________, 199_.
HEXCEL CORPORATION
By__________________________
Name:_____________________
Title:____________________
EXHIBIT F
TO
CREDIT AGREEMENT
DATED AS OF FEBRUARY 29, 1996
FORM OF REVOLVING LOAN NOTE
[NAME OF BORROWER]
U.S. $________________ February __, 1996
New York, New York
For value received, the undersigned,
________________, a _____________ [corporation][company]
(the "Borrower"), promises to pay to the order of
____________________ (the "Lender"), on the Revolving
Credit Termination Date (as defined in the Credit
Agreement referred to below), the lesser of (i) the
principal amount of ______________________________
DOLLARS ($_____________) or, in the case of Multicurrency
Loans, the Dollar Equivalent of such principal amount in
the applicable Optional Currencies in which the
Multicurrency Loans are denominated, or (ii) the unpaid
principal amount of all amounts loaned by the Lender to
the Borrower under this Note as Revolving Loans under the
Credit Agreement. All Revolving Loans shall be repaid in
the currency in which they are denominated. The
principal amount due under this Note, when aggregated
with the principal amount due under all other Notes
issued in accordance with the terms of the Credit
Agreement, will in no case exceed $175,000,000 in the
aggregate.
The Borrower also promises to pay interest on the
unpaid principal amount borrowed hereunder from the date
advanced until paid at the rates (which shall not exceed
the maximum rate permitted by applicable law) and at the
times determined in accordance with the provisions of
that certain Credit Agreement dated as of February 29,
1996 among Hexcel Corporation, Hexcel S.A. (Belgium),
Hexcel (U.K.) Limited, Composite Materials Limited United
Kingdom, Hexcel S.A. (Lyon) and Brochier S.A., the
financial institutions from time to time party thereto as
Lenders, the financial institutions from time to time
party thereto as Issuing Banks, Citibank, N.A., in its
capacity as U.S. administrative agent for the Lenders and
the Issuing Banks (in such capacity, the U.S.
Administrative Agent ), Citibank International plc, in
its capacity as European administrative agent for the
Lenders and the Issuing Banks (in such capacity, the
European Administrative Agent ), and Credit Suisse, in
its capacity as syndication agent for the Lenders and the
Issuing Banks (as amended, restated, supplemented or
otherwise modified from time to time, the Credit
Agreement ).
This Note is issued pursuant to, and is entitled to
the benefits of, the Credit Agreement, which provides for
the incurrence of up to $175,000,000 principal amount of
senior secured Indebtedness and to which reference is
hereby made for a more complete statement of the terms
and conditions under which the Revolving Loans evidenced
hereby are made and are to be repaid. Terms defined in
the Credit Agreement and not otherwise defined herein are
used herein with the meanings so defined.
All payments of principal and interest in respect of
this Note shall be made on the date and at the place due,
to the U.S. Administrative Agent in lawful money of the
United States of America in same day funds or, in the
case of Multicurrency Loans, to the European
Administrative Agent in the Optional Currencies in which
such Multicurrency Loans were made in accordance with the
Credit Agreement.
This Note shall be governed by, and shall be
construed and enforced in accordance with, the law of the
State of New York.
The Lender shall record in accordance with its
usual practice the date and amount of each Revolving Loan
made hereunder (including, in the case of Multicurrency
Loans, the applicable Optional Currency and Dollar
Equivalent thereof), and the date and amount of each
payment of principal; provided, that the failure to
record any such amount shall not limit or otherwise
affect the obligation of the Borrower to repay the Lender
the outstanding principal amount evidenced by this Note
together with accrued interest thereon in accordance with
the terms of the Credit Agreement.
Upon the occurrence of an Event of Default set forth
in Section 11.01(f) or (g) of the Credit Agreement as
applied to any Borrower (as defined in the Credit
Agreement), the unpaid balance of the principal amount of
this Note may become, and upon the occurrence and
continuation of any one or more other Events of Default,
such unpaid balance may be declared to be, due and
payable in the manner, upon the conditions and with the
effect provided in the Credit Agreement.
The Borrower hereby waives diligence,
presentment, protest, demand and notice of every kind
except as required pursuant to the Credit Agreement.
This Note is secured by certain of the Loan
Documents, and reference is made to such Loan Documents
for the terms and conditions governing the collateral
security for the Obligations of the Borrower hereunder.
IN WITNESS WHEREOF, the Borrower has caused this Note
to be executed and delivered by its duly authorized
officer, as of the day and year and at the place first
above written.
[NAME OF BORROWER]
By_____________________________
Name:
Title:
EXHIBIT G
TO
CREDIT AGREEMENT
DATED AS OF FEBRUARY 29, 1996
FORM OF SWING LOAN NOTE
HEXCEL CORPORATION
$ 10,000,000.00 February __, 1996
New York, New York
For value received, the undersigned, HEXCEL
CORPORATION, a Delaware corporation (the "Borrower"),
promises to pay to the order of Citibank, N.A. (the
"Swing Loan Bank"), in accordance with Section 2.02(d) of
the Credit Agreement, upon the earlier of (A) demand by
the Swing Loan Bank and (B) the Revolving Credit
Termination Date (as defined in the Credit Agreement
referred to below), the lesser of (i) the principal
amount of TEN MILLION DOLLARS ($ 10,000,000.00) or (ii)
the unpaid principal amount of all amounts loaned by the
Swing Loan Bank to the Borrower under this Note as Swing
Loans under the Credit Agreement. The principal amount
due under this Note, when aggregated with the principal
amount due under all other Notes issued in accordance
with the terms of the Credit Agreement, will in no case
exceed $175,000,000 in the aggregate.
The Borrower also promises to pay interest on
the unpaid principal amount borrowed hereunder from the
date advanced until paid at the rates (which shall not
exceed the maximum rate permitted by applicable law) and
at the times determined in accordance with the provisions
of that certain Credit Agreement dated as of February 29,
1996 among the Borrower, Hexcel S.A. (Belgium), Hexcel
(U.K.) Limited, Composite Materials Limited United
Kingdom, Hexcel S.A. (Lyon) and Brochier S.A., the
financial institutions from time to time party thereto as
Lenders, the financial institutions from time to time
party thereto as Issuing Banks, Citibank, N.A., in its
capacity as U.S. administrative agent for the Lenders and
the Issuing Banks (in such capacity, the "U.S.
Administrative Agent"), Citibank International plc, in
its capacity as European administrative agent for the
Lenders and the Issuing Banks, and Credit Suisse, in its
capacity as syndication agent for the Lenders and the
Issuing Banks (as amended, restated, supplemented or
otherwise modified from time to time, the "Credit
Agreement").
This Note is issued pursuant to, and is
entitled to the benefits of, the Credit Agreement, which
provides for the incurrence of up to $175,000,000
principal amount of senior secured Indebtedness and to
which reference is hereby made for a more complete
statement of the terms and conditions under which the
Swing Loans evidenced hereby are made and are to be
repaid. Terms defined in the Credit Agreement and not
otherwise defined herein are used herein with the
meanings so defined.
All payments of principal and interest in
respect of this Note shall be made on the date and at the
place due, to the U.S. Administrative Agent in lawful
money of the United States of America in same day funds
in accordance with the Credit Agreement.
This Note may be prepaid at any time at the
option of the Borrower without premium or penalty, and
must be prepaid as provided in Sections 2.02(d) and
3.01(b) of the Credit Agreement.
This Note shall be governed by, and shall be
construed and enforced in accordance with, the law of the
State of New York.
Upon the occurrence of an Event of Default set
forth in Section 11.01(f) or (g) of the Credit Agreement
as applied to any Borrower (as defined in the Credit
Agreement), the unpaid balance of the principal amount of
this Note may become, and upon the occurrence and
continuation of any one or more of certain other Events
of Default, such unpaid balance may be declared to be,
due and payable in the manner, upon the conditions and
with the effect provided in the Credit Agreement.
The Borrower hereby waives diligence,
presentment, protest, demand and notice of every kind
except as required pursuant to the Credit Agreement.
This Note is secured by certain of the Loan
Documents, and reference is made to such Loan Documents
for the terms and conditions governing the collateral
security for the Obligations of the Borrower hereunder.
IN WITNESS WHEREOF, the Borrower has caused
this Note to be executed and delivered by its duly
authorized officer, as of the day and year and at the
place first above written.
HEXCEL CORPORATION
By_________________________
Name:
Title:
EXHIBIT H
TO
CREDIT AGREEMENT
DATED AS OF FEBRUARY 29, 1996
COMPANY GUARANTY
This GUARANTY ( Guaranty ) is made as of the
29th day of February, 1996, by HEXCEL CORPORATION, a
Delaware corporation (the Guarantor ) in favor of
CITIBANK, N.A., in its capacity as U.S. administrative
agent (with its successors and permitted assigns in such
capacity, the U.S. Administrative Agent ) for the
Lenders (as defined below) and the Issuing Banks (as
defined below) for the ratable benefit of the U.S.
Administrative Agent, the Lenders, the Issuing Banks, the
European Administrative Agent (as defined below) and the
Syndication Agent (as defined below) party to that
certain Credit Agreement dated as of February 29, 1996
among Hexcel Corporation, Hexcel S.A. ( Hexcel Belgium ),
Hexcel (U.K.) Limited ( Hexcel U.K. ), Composite
Materials Limited United Kingdom ( CML ), Hexcel S.A.
( Hexcel Lyon ) and Brochier S.A. ( Brochier ; and
together with Hexcel Belgium, Hexcel U.K., CML, and
Hexcel Lyon, the Foreign Borrowers ), the institutions
from time to time party thereto as lenders (the
Lenders ), the institutions from time to time party
thereto as issuing banks (the Issuing Banks ), the U.S.
Administrative Agent, Citibank International plc, in its
capacity as European administrative agent (in such
capacity, the European Administrative Agent ) and Credit
Suisse, in its capacity as syndication agent (in such
capacity, the Syndication Agent )(as amended, restated,
supplemented or otherwise modified from time to time, the
Credit Agreement ). Terms defined in the Credit
Agreement and not otherwise defined herein are used
herein with the meanings ascribed thereto in the Credit
Agreement.
W I T N E S S E T H
WHEREAS, each of Hexcel Belgium, Hexcel U.K. and
Hexcel Lyon is a wholly-owned Subsidiary of the Company,
CML is a wholly-owned Subsidiary of Hexcel U.K., and
Brochier and CDSR are wholly-owned Subsidiaries of Hexcel
Lyon;
WHEREAS, the Guarantor will directly and indirectly
benefit from the loans and other financial accommodations
made to the Foreign Borrowers pursuant to the Credit
Agreement;
WHEREAS, the Lenders, the Issuing Banks, the U.S.
Administrative Agent, the European Administrative Agent
and the Syndication Agent have required as a condition,
among others, to entering into the Credit Agreement, that
the Guarantor guarantee the Obligations of the Foreign
Borrowers (the Guaranteed Obligations );
NOW THEREFORE, in consideration of the premises set
forth above, the terms and conditions contained herein,
and other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the
parties hereto hereby agree as follows:
1. Guaranty. (i) For value received and in
consideration of the Obligations of the Foreign
Borrowers, the Guarantor unconditionally guarantees for
the benefit of the U.S. Administrative Agent, the Issuing
Banks, the Lenders, the European Administrative Agent and
the Syndication Agent the full and prompt payment when
due, whether at maturity or earlier, by reason of
acceleration or otherwise, and at all times thereafter,
of all the Guaranteed Obligations (including, without
limitation, interest accruing following the commencement
of any insolvency or bankruptcy case or proceeding or
other similar case or proceeding in respect of any
Foreign Borrower, at the applicable rate specified in the
Credit Agreement, whether or not such interest is allowed
as a claim in such case or proceeding).
(ii) At any time after the occurrence and
during the continuation of an Event of Default set forth
in Section 11.01(a) of the Credit Agreement, the
Guarantor shall pay to the U.S. Administrative Agent, for
the benefit of the U.S. Administrative Agent, the Issuing
Banks, the Lenders, the European Administrative Agent and
the Syndication Agent, on demand and in immediately
available funds, the amount of the Guaranteed Obligations
that is due and payable, and upon acceleration, the full
amount thereof. The Guarantor further agrees to pay and
reimburse the U.S. Administrative Agent, the Issuing
Banks, the Lenders, the European Administrative Agent and
the Syndication Agent for, on demand and in immediately
available funds, all reasonable fees, costs and expenses
(including, without limitation, all court costs and
reasonable attorneys' fees, costs and expenses) paid or
incurred by the U.S. Administrative Agent, the Issuing
Banks, the Lenders, the European Administrative Agent or
the Syndication Agent in: (1) endeavoring to collect all
or any part of the Guaranteed Obligations from, or in
prosecuting any action in respect of the Guaranteed
Obligations against, any Foreign Borrower or the
Guarantor; (2) taking any action with respect to any
security or collateral securing the Guaranteed
Obligations or the Guarantor's obligations hereunder; and
(3) preserving, protecting or defending the
enforceability of, or enforcing, this Guaranty or the
U.S. Administrative Agent's rights hereunder (all such
costs and expenses are hereinafter referred to as the
Expenses ), and interest thereon. The Guarantor hereby
agrees that this Guaranty is an absolute guaranty of
payment and is not a guaranty of collection.
2. Obligations Unconditional. The Guarantor
hereby agrees that its obligations under this Guaranty
shall be unconditional, irrespective of:
(i) the validity, enforceability, avoidance or
subordination of any of the Guaranteed Obligations or any
of the Loan Documents;
(ii) the absence of any attempt by, or on
behalf of, the U.S. Administrative Agent, any of the
Issuing Banks, any of the Lenders, the European
Administrative Agent or the Syndication Agent to collect,
or to take any other action to enforce, all or any part
of the Guaranteed Obligations whether from or against any
Foreign Borrower, the Guarantor or any other guarantor of
the Guaranteed Obligations or any other Person;
(iii) the election of any remedy by, or on
behalf of, the U.S. Administrative Agent, any of the
Issuing Banks, any of the Lenders, the European
Administrative Agent or the Syndication Agent with
respect to all or any part of the Guaranteed Obligations;
(iv) the waiver, consent, extension,
forbearance or granting of any indulgence by, or on
behalf of, the U.S. Administrative Agent, any of the
Issuing Banks, any of the Lenders, the European
Administrative Agent or the Syndication Agent with
respect to any provision of any of the Loan Documents;
(v) the failure of the U.S. Administrative
Agent, any of the Issuing Banks, any of the Lenders, the
European Administrative Agent or the Syndication Agent to
take any steps to perfect and maintain its security
interest in, or to preserve its rights to, any security
or collateral for the Guaranteed Obligations;
(vi) the election by, or on behalf of, the U.S.
Administrative Agent, any of the Issuing Banks, any of
the Lenders, the European Administrative Agent or the
Syndication Agent, in any proceeding instituted under
Chapter 11 of Bankruptcy Code, of the application of
Section 1111(b)(2) of the Bankruptcy Code;
(vii) any borrowing or grant of a security
interest by any Foreign Borrower, as
debtor-in-possession, under Section 364 of the Bankruptcy
Code;
(viii) the disallowance, under Section 502 of
the Bankruptcy Code, of all or any portion of the claims
against any Foreign Borrower of any of the Lenders, any
of the Issuing Banks, the U.S. Administrative Agent, the
European Administrative Agent or the Syndication Agent
for repayment of all or any part of the Guaranteed
Obligations or any Expenses; or
(ix) any other circumstance which might
otherwise constitute a legal or equitable discharge or
defense of the Guarantor, any Foreign Borrower or any
other guarantor of the Obligations.
3. Enforcement; Application of Payments.
Subject to Section 1(ii) hereof and the provisions of the
Credit Agreement, upon the occurrence and during the
continuation of an Event of Default, the U.S.
Administrative Agent, the Issuing Banks, the Lenders, the
European Administrative Agent and/or the Syndication
Agent may proceed directly against the Guarantor to
collect and recover the full amount, or any portion, of
the Guaranteed Obligations, without first proceeding
against any Foreign Borrower or any other Person, or
against any security or collateral for the Guaranteed
Obligations. Subject only to the terms and provisions of
the Credit Agreement, the Lenders and the Issuing Banks
shall have the exclusive right to determine the
application of payments and credits, if any, from the
Guarantor, any Foreign Borrower or from any other Person
on account of the Guaranteed Obligations or any other
liability of the Guarantor to the U.S. Administrative
Agent, any of the Issuing Banks, any of the Lenders, the
European Administrative Agent or the Syndication Agent.
4. Waivers. (i) The Guarantor hereby waives
diligence, presentment, demand of payment, filing of
claims with a court in the event of receivership or
bankruptcy of any Foreign Borrower, protest or notice
with respect to the Guaranteed Obligations, all setoffs
and counterclaims, demands for performance, notices of
nonperformance, notices of protest, notices of dishonor
and notices of acceptance of this Guaranty, and all other
demands whatsoever (and shall not require that the same
be made on any Foreign Borrower as a condition precedent
to the Guarantor's obligations hereunder), and covenants
that this Guaranty will not be discharged, except by
complete payment (in cash) and performance of the
Guaranteed Obligations and any other obligations
contained herein. The Guarantor further waives all
notices of the existence, creation or incurring of new or
additional Indebtedness, arising either from additional
loans extended to any Foreign Borrower or otherwise, and
also waives all notices that the principal amount, or any
portion thereof, and/or any interest on any instrument or
document evidencing all or any part of the Guaranteed
Obligations is due, notices of any and all proceedings to
collect from the maker, any endorser or any other
guarantor of all or any part of the Guaranteed
Obligations, or from any other Person, and, to the extent
permitted by law, notices of exchange, sale, surrender or
other handling of any security or collateral given to the
U.S. Administrative Agent, any of the Issuing Banks, any
of the Lenders, the European Administrative Agent or the
Syndication Agent to secure payment of all or any part of
the Guaranteed Obligations.
(ii) The U.S. Administrative Agent, the
Issuing Banks, the Lenders, the European Administrative
Agent and/or the Syndication Agent are hereby authorized,
without notice or demand and without affecting the
liability of the Guarantor hereunder, from time to time,
(a) to renew, extend, accelerate or otherwise change the
time for payment of, or other terms relating to, all or
any part of the Guaranteed Obligations, or to otherwise
modify, amend or change the terms of any of the Loan
Documents; (b) to accept partial payments on all or any
part of the Guaranteed Obligations; (c) to take and hold
security or collateral for the payment of all or any part
of the Guaranteed Obligations, this Guaranty, or any
other guaranties of all or any part of the Guaranteed
Obligations or other liabilities of the Foreign
Borrowers, (d) to exchange, enforce, waive and release
any such security or collateral; (e) to apply such
security or collateral and direct the order or manner of
sale thereof as in its discretion it may determine;
(f) to settle, release, exchange, enforce, waive,
compromise or collect or otherwise liquidate all or any
part of the Guaranteed Obligations, this Guaranty, any
other guaranty of all or any part of the Obligations, and
any security or collateral for the Obligations or for any
such guaranty. Any of the foregoing may be done in any
manner, without affecting or impairing the obligations of
the Guarantor hereunder.
5. Setoff. At any time after all or any part
of the Guaranteed Obligations have become due and payable
(by acceleration or otherwise), the Lenders and the
Issuing Banks may, without notice to the Guarantor and
regardless of the acceptance of any security or
collateral for the payment hereof, appropriate and apply
toward the payment of all or any part of the Guaranteed
Obligations (i) any Indebtedness due or to become due
from the Lenders or the Issuing Banks to the Guarantor,
and (ii) any moneys, credits or other property belonging
to the Guarantor, at any time held by or coming into the
possession of the Lenders or the Issuing Banks or their
respective affiliates.
6. Financial Information. The Guarantor
hereby assumes responsibility for keeping itself informed
of the financial condition of the Foreign Borrowers and
any and all other guarantors and/or endorsers of all or
any part of the Guaranteed Obligations, and of all other
circumstances bearing upon the risk of nonpayment of the
Guaranteed Obligations, or any part thereof, that
diligent inquiry would reveal, and the Guarantor hereby
agrees that the U.S. Administrative Agent, the Issuing
Banks, the Lenders, the European Administrative Agent and
the Syndication Agent shall have no duty to advise the
Guarantor of information known to it regarding such
condition or any such circumstances. In the event that
the U.S. Administrative Agent, any of the Issuing Banks,
any of the Lenders, the European Administrative Agent or
the Syndication Agent, in its sole discretion, undertakes
at any time or from time to time to provide any such
information to the Guarantor, the U.S. Administrative
Agent, such Issuing Bank, such Lender, the European
Administrative Agent or the Syndication Agent shall be
under no obligation (i) to undertake any investigation
not a part of its regular business routine, (ii) to
disclose any information which the U.S. Administrative
Agent, such Issuing Bank, such Lender, the European
Administrative Agent or the Syndication Agent, pursuant
to accepted or reasonable commercial finance or banking
practices, wishes to maintain confidential or (iii) to
make any other or future disclosures of such information
or any other information to the Guarantor.
7. No Marshalling; Reinstatement. The
Guarantor consents and agrees that none of the U.S.
Administrative Agent, any of the Issuing Banks, any of
the Lenders, the European Administrative Agent, the
Syndication Agent or any Person acting for or on behalf
of the U.S. Administrative Agent shall be under any
obligation to marshall any assets in favor of the
Guarantor or against or in payment of any or all of the
Guaranteed Obligations. The Guarantor further agrees
that, to the extent that any Foreign Borrower or any
other guarantor of all or any part of the Guaranteed
Obligations makes a payment or payments to the U.S.
Administrative Agent or the Lenders or the Issuing Banks
or the European Administrative Agent or the Syndication
Agent, or the U.S. Administrative Agent or any Lender or
Issuing Bank or the Syndication Agent receives any
proceeds of Collateral, which payment or payments or any
part thereof are subsequently invalidated, declared to be
fraudulent or preferential, set aside and/or required to
be repaid to such Foreign Borrower, such other guarantor
or any other Person, or their respective estates,
trustees, receivers or any other party, including,
without limitation, the Guarantor, under any bankruptcy
law, state or federal law, common law or equitable cause,
then, to the extent of such payment or repayment, the
part of the Guaranteed Obligations which has been paid,
reduced or satisfied by such amount shall be reinstated
and continued in full force and effect as of the time
immediately preceding such initial payment, reduction or
satisfaction.
8. Subrogation. Until the Guaranteed
Obligations shall have been paid in full, the Guarantor
hereby agrees that it (i) shall not exercise any right of
subrogation with respect to such Guaranteed Obligations
(under contract, Section 509 of the Bankruptcy Code or
otherwise) or any other right of indemnity, reimbursement
or contribution, (ii) waives any right to enforce any
remedy which the U.S. Administrative Agent, any of the
Lenders, any of the Issuing Banks, the European
Administrative Agent or the Syndication Agent now have or
may hereafter have against any Foreign Borrower, any
endorser or any other guarantor of all or any part of the
Guaranteed Obligations or any other Person, and (iii)
waives any benefit of, and any right to participate in,
any security or collateral given to the U.S.
Administrative Agent, the Lenders, the Issuing Banks, the
European Administrative Agent and the Syndication Agent
to secure the payment or performance of all or any part
of the Guaranteed Obligations or any other liability of
any Foreign Borrower to the U.S. Administrative Agent,
the Lenders, the Issuing Banks, the European
Administrative Agent and the Syndication Agent.
9. Subordination. The Guarantor agrees that
any and all claims of the Guarantor against any Foreign
Borrower or any endorser or other guarantor of all or any
part of the Guaranteed Obligations, or against any of
their respective properties with respect to any
Indebtedness of such Foreign Borrower to the Guarantor
(the Borrower Indebtedness ), shall be subordinated to
the payment in full in cash of all Guaranteed
Obligations. Notwithstanding any right of the Guarantor
to ask, demand, sue for, take or receive any payment from
any Foreign Borrower, all such rights and Liens of the
Guarantor with respect to the Borrower Indebtedness,
whether now or hereafter arising and howsoever existing
shall be and hereby are subordinated to the rights of the
U.S. Administrative Agent, the Issuing Banks, the
Lenders, the European Administrative Agent and the
Syndication Agent to receive payment in full in cash of
the Guaranteed Obligations. So long as no Event of
Default set forth in Section 11.01(a), (f) or (g) of the
Credit Agreement shall have occurred and is continuing,
the Guarantor shall retain all its rights and shall be
entitled to receive and retain any and all payments made
in respect of, the Borrower Indebtedness. After an Event
of Default set forth in Section 11.01(a), (f) or (g) of
the Credit Agreement shall have occurred and is
continuing, the Guarantor shall not exercise any rights
with respect to the Borrower Indebtedness or to foreclose
upon any asset securing the Borrower Indebtedness,
whether by judicial action or otherwise, unless and until
all of the Guaranteed Obligations shall have been fully
paid in cash and all financing arrangements pursuant to
the Credit Agreement between the Foreign Borrowers and
the Lenders and the Issuing Banks have been terminated.
If all or any part of the assets of any Foreign Borrower,
or the proceeds thereof, are subject to any distribution,
division or application to the creditors of such Foreign
Borrower, whether partial or complete, voluntary or
involuntary, and whether by reason of liquidation,
bankruptcy, arrangement, receivership, assignment for the
benefit of creditors or any other action or proceeding,
or if the business of any Foreign Borrower is dissolved
or if substantially all of the assets of any Foreign
Borrower are sold, then, and in any such event, any
payment or distribution of any kind or character, either
in cash, securities or other property, which shall be
payable or deliverable upon or with respect to any
Borrower Indebtedness shall be paid or delivered directly
to the Lenders and the Issuing Banks for application to
any of the Guaranteed Obligations, due or to become due,
until such Guaranteed Obligations shall have first been
fully paid in cash and satisfied. The Guarantor
irrevocably authorizes and empowers the U.S.
Administrative Agent and each of the Lenders and each of
the Issuing Banks, the European Administrative Agent and
the Syndication Agent to demand, sue for, collect and
receive every such payment or distribution and give
acquittance therefor and to make and present for and on
behalf of the Guarantor such proofs of claim and take
such other action, in the U.S. Administrative Agent's or
such Lender's or Issuing Bank's or the European
Administrative Agent s or the Syndication Agent s own
name or in the name of the Guarantor or otherwise, as the
U.S. Administrative Agent or any Lender or Issuing Bank
or the European Administrative Agent or the Syndication
Agent may deem necessary or advisable for the enforcement
of this Guaranty. Each Lender and each Issuing Bank may
vote such proofs of claim in any such proceeding, receive
and collect any and all dividends or other payments or
disbursements made thereon in whatever form the same may
be paid or issued and apply the same on account of any of
the Guaranteed Obligations. Should any payment,
distribution, security or instrument or proceeds thereof
be received by the Guarantor upon or with respect to the
Borrower Indebtedness after an Event of Default set forth
in Section 11.01(a), (f) or (g) of the Credit Agreement
shall have occurred and is continuing, and prior to the
payment in full in cash of all Guaranteed Obligations and
the termination of all financing arrangements pursuant to
the Credit Agreement between the Foreign Borrowers and
the Lenders and the Issuing Banks, the Guarantor shall
receive and hold the same in trust, as trustee, for the
benefit of the U.S. Administrative Agent, the Issuing
Banks, the Lenders, the European Administrative Agent and
the Syndication Agent and shall forthwith deliver the
same to the U.S. Administrative Agent, in precisely the
form received (except for the endorsement or assignment
of the Guarantor where necessary), for application to any
of the Guaranteed Obligations, due or not due, and, until
so delivered, the same shall be held in trust by the
Guarantor as the property of the U.S. Administrative
Agent, the Issuing Banks, the Lenders, the European
Administrative Agent and the Syndication Agent; provided,
that if the Guarantor fails to make any such endorsement
or assignment to the U.S. Administrative Agent, the
Issuing Banks, the Lenders, the European Administrative
Agent or the Syndication Agent, the U.S. Administrative
Agent, the Issuing Banks, the Lenders, the European
Administrative Agent or the Syndication Agent or any of
its officers or employees are hereby irrevocably
authorized to make the same. The Guarantor agrees that
after an Event of Default set forth in Section 11.01(a),
(f) or (g) of the Credit Agreement shall have occurred
and is continuing, and until the Guaranteed Obligations
have been paid in full (in cash) and satisfied and all
financing arrangements pursuant to the Credit Agreement
between the Foreign Borrowers and the Lenders and the
Issuing Banks have been terminated, the Guarantor will
not assign or transfer to any Person any claim the
Guarantor has or may have against any Foreign Borrower.
10. Enforcement; Amendments; Waivers. No
delay on the part of the U.S. Administrative Agent, any
of the Issuing Banks, any of the Lenders, the European
Administrative Agent or the Syndication Agent in the
exercise of any right or remedy arising under this
Guaranty, the Credit Agreement, any of the other Loan
Documents or otherwise with respect to all or any part of
the Guaranteed Obligations, the Collateral or any other
guaranty of or security for all or any part of the
Guaranteed Obligations shall operate as a waiver thereof,
and no single or partial exercise by the U.S.
Administrative Agent, any of the Issuing Banks, any of
the Lenders, the European Administrative Agent or the
Syndication Agent of any such right or remedy shall
preclude any further exercise thereof. No modification
or waiver of any of the provisions of this Guaranty shall
be binding upon the U.S. Administrative Agent, any of the
Issuing Banks, any of the Lenders, the European
Administrative Agent or the Syndication Agent, except as
expressly set forth in a writing duly signed and
delivered by the U.S. Administrative Agent. Failure by
the U.S. Administrative Agent, any of the Issuing Banks,
any of the Lenders, the European Administrative Agent or
the Syndication Agent at any time or times hereafter to
require strict performance by any Foreign Borrower, any
other guarantor of all or any part of the Guaranteed
Obligations or any other Person of any of the provisions,
warranties, terms and conditions contained in any of the
Loan Documents now or at any time or times hereafter
executed by such Persons and delivered to the U.S.
Administrative Agent, any of the Issuing Banks, any of
the Lenders, the European Administrative Agent or the
Syndication Agent shall not waive, affect or diminish any
right of the U.S. Administrative Agent, any of the
Issuing Banks, any of the Lenders, the European
Administrative Agent or the Syndication Agent at any time
or times hereafter to demand strict performance thereof
and such right shall not be deemed to have been waived by
any act or knowledge of the U.S. Administrative Agent,
any of the Issuing Banks, any of the Lenders, the
European Administrative Agent or the Syndication Agent,
or its agents, officers or employees, unless such waiver
is contained in an instrument in writing, directed and
delivered to the Guarantor, specifying such waiver, and
is signed by the U.S. Administrative Agent. No waiver of
any Event of Default by the Lenders shall operate as a
waiver of any other Event of Default or the same Event of
Default on a future occasion, and no action by the U.S.
Administrative Agent, any of the Issuing Banks, any of
the Lenders, the European Administrative Agent or the
Syndication Agent permitted hereunder shall in any way
affect or impair the U.S. Administrative Agent's, any
Issuing Bank's, any Lender's, the European Administrative
Agent s or the Syndication Agent s rights and remedies or
the obligations of the Guarantor under this Guaranty.
Any determination by a court of competent jurisdiction of
the amount of any principal and/or interest owing by any
Foreign Borrower to the U.S. Administrative Agent, the
Lenders, the Issuing Banks, the European Administrative
Agent and the Syndication Agent shall be conclusive and
binding on the Guarantor irrespective of whether the
Guarantor was a party to the suit or action in which such
determination was made.
11. Effectiveness; Termination. This Guaranty
shall become effective against the Guarantor upon its
execution by the Guarantor and shall continue in full
force and effect and may not be terminated or otherwise
revoked until the Guaranteed Obligations (other than
indemnities not yet due) shall have been fully paid (in
cash) and discharged and the Credit Agreement and the
Revolving Credit Commitments shall have been terminated.
If, notwithstanding the foregoing, the Guarantor shall
have any right under applicable law to terminate or
revoke its obligations under this Guaranty, the Guarantor
agrees that such termination or revocation shall not be
effective until a written notice of such revocation or
termination, specifically referring hereto, signed by the
Guarantor, is actually received by the U.S.
Administrative Agent. Such notice shall not affect the
right and power of the U.S. Administrative Agent, any of
the Issuing Banks, any of the Lenders, the European
Administrative Agent or the Syndication Agent to enforce
rights arising prior to receipt thereof by the U.S.
Administrative Agent, the Issuing Banks, the Lenders, the
European Administrative Agent and the Syndication Agent.
If any of the Lenders or Issuing Banks grants Loans or
takes other action after the Guarantor terminates or
revokes its obligations under this Guaranty but before
such Lender or Issuing Bank receives such written notice,
the rights of such Lender or such Issuing Bank with
respect thereto shall be the same as if such termination
or revocation had not occurred.
12. Successors and Assigns. This Guaranty
shall be binding upon the parties hereto and their
respective successors and permitted assigns, and shall
inure to the benefit of the parties hereto and the
successors and permitted assigns of the U.S.
Administrative Agent, the Lenders, the Issuing Banks, the
European Administrative Agent and the Syndication Agent.
The rights hereunder and the interest herein of the
Guarantor may not be assigned without the written consent
of the Requisite Lenders. Any attempted assignment
without such written consent shall be void. Nothing set
forth herein or in any other Loan Document is intended or
shall be construed to give any other Person any right,
remedy or claim under, to or in respect of this Guaranty.
The Guarantor's successors shall include, without
limitation, a receiver, trustee or debtor-in-possession
of or for the Guarantor.
13. Governing Law. This Guaranty shall be
construed, and the rights and duties of the parties
hereto shall be determined, in accordance with the law of
the State of New York.
14. Certain Consents and Waivers.
(a) Personal Jurisdiction. TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW, (i) EACH OF THE U.S.
ADMINISTRATIVE AGENT AND THE GUARANTOR IRREVOCABLY AND
UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS PROPERTY, TO
THE NONEXCLUSIVE JURISDICTION OF ANY NEW YORK STATE COURT
OR FEDERAL COURT SITTING IN NEW YORK, NEW YORK, AND ANY
COURT HAVING JURISDICTION OVER APPEALS OF MATTERS HEARD
IN SUCH COURTS, IN ANY ACTION OR PROCEEDING ARISING OUT
OF, CONNECTED WITH, RELATED TO OR INCIDENTAL TO THE
RELATIONSHIP ESTABLISHED AMONG THEM IN CONNECTION WITH
THIS AGREEMENT, WHETHER ARISING IN CONTRACT, TORT, EQUITY
OR OTHERWISE, OR FOR RECOGNITION OR ENFORCEMENT OF ANY
JUDGMENT RELATED HERETO, AND EACH OF THE PARTIES HERETO
IRREVOCABLY AND UNCONDITIONALLY AGREES THAT ALL CLAIMS IN
RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD AND
DETERMINED IN SUCH STATE COURT OR IN SUCH FEDERAL COURT.
EACH OF THE GUARANTORS IRREVOCABLY DESIGNATES AND
APPOINTS CT CORPORATION SYSTEMS AT 1633 BROADWAY, NEW
YORK, NEW YORK 10019, AS ITS RESPECTIVE PROCESS AGENT
(THE PROCESS AGENT ) FOR SERVICE OF ALL PROCESS IN ANY
SUCH PROCEEDING IN ANY SUCH COURT, SUCH SERVICE BEING
HEREBY ACKNOWLEDGED TO BE EFFECTIVE AND BINDING SERVICE
IN EVERY RESPECT. EACH OF THE U.S. ADMINISTRATIVE AGENT
AND THE GUARANTOR AGREES THAT A FINAL NONAPPEALABLE
JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE
CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY
SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY
LAW. EACH OF THE U.S. ADMINISTRATIVE AGENT AND THE
GUARANTOR WAIVES IN ALL DISPUTES ANY OBJECTION THAT IT
MAY HAVE TO THE LOCATION OF THE COURT CONSIDERING THE
DISPUTE IN ANY SUCH ACTION OR PROCEEDING IN SUCH STATE
COURT OR IN SUCH FEDERAL COURT.
(ii) THE GUARANTOR AGREES THAT THE U.S.
ADMINISTRATIVE AGENT SHALL HAVE THE RIGHT TO PROCEED
AGAINST THE GUARANTOR OR ITS PROPERTY IN A COURT HAVING
JURISDICTION IN ANY LOCATION TO ENABLE THE U.S.
ADMINISTRATIVE AGENT, THE ISSUING BANKS, THE LENDERS, THE
EUROPEAN ADMINISTRATIVE AGENT AND THE SYNDICATION AGENT
TO REALIZE ON THE COLLATERAL OR ANY OTHER SECURITY FOR
THE GUARANTEED OBLIGATIONS, OR TO ENFORCE A JUDGMENT OR
OTHER COURT ORDER ENTERED IN FAVOR OF THE U.S.
ADMINISTRATIVE AGENT, ANY ISSUING BANK, ANY LENDER, THE
EUROPEAN ADMINISTRATIVE AGENT OR THE SYNDICATION AGENT.
THE GUARANTOR WAIVES ANY OBJECTION THAT IT MAY HAVE TO
THE LOCATION OF THE COURT IN WHICH THE U.S.
ADMINISTRATIVE AGENT, ANY ISSUING BANK, ANY LENDER, THE
EUROPEAN ADMINISTRATIVE AGENT OR THE SYNDICATION AGENT
MAY COMMENCE A PROCEEDING DESCRIBED IN THIS SECTION.
(b) Service of Process. TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW: THE GUARANTOR IRREVOCABLY
CONSENTS TO THE SERVICE OF PROCESS OF ANY OF THE
AFOREMENTIONED COURTS IN ANY SUCH ACTION OR PROCEEDING BY
THE MAILING OF COPIES THEREOF BY REGISTERED OR CERTIFIED
MAIL, POSTAGE PREPAID, TO THE PROCESS AGENT OR THE
GUARANTOR'S NOTICE ADDRESS SPECIFIED PURSUANT TO SECTION
16 HEREOF, SUCH SERVICE TO BECOME EFFECTIVE TEN (10) DAYS
AFTER SUCH MAILING. EACH OF THE U.S. ADMINISTRATIVE
AGENT AND THE GUARANTOR IRREVOCABLY WAIVES ANY OBJECTION
THAT IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY
SUCH ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT
OR ANY OTHER LOAN DOCUMENT IN ANY JURISDICTION SET FORTH
ABOVE. NOTHING HEREIN SHALL AFFECT THE RIGHT TO SERVE
PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR SHALL
LIMIT THE RIGHT OF THE U.S. ADMINISTRATIVE AGENT TO BRING
PROCEEDINGS AGAINST THE GUARANTOR IN THE COURTS OF ANY
OTHER JURISDICTION.
(c) Waiver of Jury Trial. EACH OF THE U.S.
ADMINISTRATIVE AGENT AND THE GUARANTOR IRREVOCABLY WAIVES
TRIAL BY JURY IN ANY ACTION OR PROCEEDING WITH RESPECT TO
THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT.
15. Waiver of Bond. The Guarantor waives the
posting of any bond otherwise required of the U.S.
Administrative Agent in connection with any judicial
process or proceeding to realize on the Collateral or any
other security for the Guaranteed Obligations, to enforce
any judgment or other court order entered in favor of the
U.S. Administrative Agent, or to enforce by specific
performance, temporary restraining order, or preliminary
or permanent injunction, this Guaranty or any other
agreement or document between the U.S. Administrative
Agent and the Guarantor.
16. Notices. All notices and other
communications required or desired to be served, given or
delivered hereunder shall be in writing or by a
telecommunications device capable of creating a printed
record and shall be addressed to the party to be notified
as follows:
if to the Guarantor, at:
Hexcel Corporation
5794 West Las Positas Boulevard
Pleasanton, California 94588
Attention: Treasurer
with a copy to:
Skadden, Arps, Slate, Meagher & Flom
919 Third Avenue
New York, New York 10022
Attention: Peter J. Neckles, Esq.
Telecopier No.: (212) 735-2000
Confirmation No.: (212) 735-3000
if to the U.S. Administrative Agent, at:
Citibank, N.A.
399 Park Avenue
6th Floor, Zone 11
New York, New York 10043
Attention: William Clark
Telecopier No.: (212) 793-7460
Confirmation No.: (212) 559-5944
with a copy to:
Sidley & Austin
875 Third Avenue
New York, New York 10022
Attention: Daniel S. Dokos, Esq.
Telecopier No.: (212) 906-2021
Confirmation No.: (212) 906-2312
or, as to each party, at such other address as designated
by such party in a written notice to the other party.
All such notices and communications shall be deemed to be
validly served, given or delivered (i) ten (10) days
following deposit in the United States mails, with proper
postage prepaid; (ii) one Business Day after delivery
thereof if delivered by hand to the party to be notified;
(iii) upon delivery thereof to a reputable overnight
courier service, with delivery charges prepaid; or (iv)
upon confirmation of receipt thereof if transmitted by a
telecommunications device.
17. Severability. Wherever possible, each
provision of this Guaranty shall be interpreted in such
manner as to be effective and valid under applicable law,
but if any provision of this Guaranty shall be prohibited
by or invalid under such law, such provision shall be
ineffective to the extent of such prohibition or
invalidity without invalidating the remainder of such
provision or the remaining provisions of this Guaranty.
18. Collateral. The Guarantor hereby
acknowledges and agrees that its obligations under this
Guaranty are secured pursuant to the terms and provisions
of the other Loan Documents to which it is a party.
19. Entire Agreement. This Guaranty, together
with the other Loan Documents, embodies the entire
agreement and understanding of the parties hereto with
respect to the matters contained herein and supersedes
all prior agreements and understandings, written and
oral, relating to the subject matter hereof.
21. Execution in Counterparts. This Guaranty
may be executed in any number of counterparts and by
different parties hereto in separate counterparts, each
of which when so executed shall be deemed to be an
original and all of which taken together shall constitute
one and the same agreement.
IN WITNESS WHEREOF, this Guaranty has been duly
executed by the Guarantor as of the day and year first
set forth above.
HEXCEL CORPORATION
By_________________________
Name:
Title:
Acknowledged and agreed to
as of the __ day of February, 1996.
CITIBANK, N.A., as U.S.
Administrative Agent
By:
Name:
Title:
EXHIBIT I
TO
CREDIT AGREEMENT
DATED AS OF FEBRUARY 29, 1996
DOMESTIC SUBSIDIARY GUARANTY
This SUBSIDIARY GUARANTY ( Guaranty ) is made
as of the 29th day of February, 1996, by HEXCEL BETA
CORPORATION, a Delaware corporation, HEXCEL FAR EAST, a
California corporation, HEXCEL INTERNATIONAL, a
California corporation, and HEXCEL TECHNOLOGIES, INC., a
Delaware corporation (each individually a Guarantor ,
and collectively the Guarantors ), in favor of CITIBANK,
N.A., in its capacity as U.S. administrative agent (with
its successors and permitted assigns in such capacity,
the Administrative Agent ) for the Lenders (as defined
below) and the Issuing Banks (as defined below) for the
ratable benefit of the Administrative Agent, the Lenders,
the Issuing Banks, the European Administrative Agent (as
defined below) and the Syndication Agent (as defined
below) party to that certain Credit Agreement dated as of
February 29, 1996 among Hexcel S.A. ( Hexcel Belgium ),
Hexcel (U.K.) Limited ( Hexcel U.K. ), Composite
Materials Limited United Kingdom ( CML ), Hexcel S.A.
( Hexcel Lyon ) and Brochier S.A. ( Brochier ; and
together with Hexcel Belgium, Hexcel U.K., CML and Hexcel
Lyon, the Foreign Borrowers ), Hexcel Corporation (the
Company ; and together with the Foreign Borrowers, the
Borrowers ), the institutions from time to time party
thereto as lenders (the Lenders ), the institutions from
time to time party thereto as issuing banks (the Issuing
Banks ), the Administrative Agent, Citibank International
plc, in its capacity as European Administrative Agent (in
such capacity, the European Administrative Agent ) and
Credit Suisse, in its capacity as syndication agent (in
such capacity, the Syndication Agent )(as amended,
restated, supplemented or otherwise modified from time to
time, the Credit Agreement ). Terms defined in the
Credit Agreement and not otherwise defined herein are
used herein with the meanings ascribed thereto in the
Credit Agreement.
W I T N E S S E T H
WHEREAS, each of Hexcel Belgium, Hexcel U.K.
and Hexcel Lyon is a wholly-owned Foreign Subsidiary of
the Company, CML is a wholly-owned Subsidiary of Hexcel
U.K., and Brochier and CDSR are wholly-owned Subsidiaries
of Hexcel Lyon;
WHEREAS, the Guarantors are direct wholly-owned
domestic Subsidiaries of the Company and will directly
and indirectly benefit from the loans and other financial
accommodations made pursuant to the Credit Agreement to
the Company and the Foreign Borrowers;
WHEREAS, the Lenders, the Issuing Banks, the
Administrative Agent, the European Administrative Agent
and the Syndication Agent have required as a condition,
among others, to entering into the Credit Agreement, that
each Guarantor guarantee the Obligations of the Borrowers
on the terms set forth herein;
NOW THEREFORE, in consideration of the premises
set forth above, the terms and conditions contained
herein, and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged,
the parties hereto hereby agree as follows:
1. Guaranty. (i) For value received and in
consideration of any loan, advance or financial
accommodation of any kind whatsoever heretofore, now or
hereafter made, given or granted to the Borrowers by the
Lenders and the Issuing Banks pursuant to the Loan
Documents, each Guarantor jointly and severally
unconditionally guarantees for the benefit of the
Administrative Agent, the Issuing Banks, the Lenders, the
European Administrative Agent and the Syndication Agent
the full and prompt payment when due, whether at maturity
or earlier, by reason of acceleration or otherwise, and
at all times thereafter, of all the Obligations
(including, without limitation, interest accruing
following the commencement of any insolvency or
bankruptcy case or proceeding or other similar case or
proceeding in respect of any Borrower, at the applicable
rate specified in the Credit Agreement, whether or not
such interest is allowed as a claim in such case or
proceeding).
(ii) At any time after the occurrence and
during the continuation of an Event of Default set forth
in Section 11.01(a) of the Credit Agreement, each
Guarantor shall jointly and severally pay to the
Administrative Agent, for the benefit of the
Administrative Agent, the Issuing Banks, the Lenders, the
European Administrative Agent and the Syndication Agent,
on demand and in immediately available funds, the amount
of the Obligations that is due and payable, and upon
acceleration, the full amount thereof. Each Guarantor
further agrees to jointly and severally pay and reimburse
the Administrative Agent, the Issuing Banks, the Lenders,
the European Administrative Agent and the Syndication
Agent for, on demand and in immediately available funds,
all reasonable fees, costs and expenses (including,
without limitation, all court costs and reasonable
attorneys' fees, costs and expenses) paid or incurred by
the Administrative Agent, the Issuing Banks, the Lenders,
the European Administrative Agent or the Syndication
Agent in: (1) endeavoring to collect all or any part of
the Obligations from, or in prosecuting any action in
respect of the Obligations against, any Borrower or such
Guarantor; (2) taking any action with respect to any
security or collateral securing the Obligations or such
Guarantor's obligations hereunder; and (3) preserving,
protecting or defending the enforceability of, or
enforcing, this Guaranty or the Administrative Agent's
rights hereunder (all such costs and expenses are
hereinafter referred to as the Expenses ), and interest
thereon. Each Guarantor hereby agrees that this Guaranty
is an absolute guaranty of payment and is not a guaranty
of collection.
(iii) Notwithstanding anything contained in
this Guaranty to the contrary, the amount guaranteed by
each Guarantor hereunder shall be limited to an aggregate
amount which is equal to the largest amount that would
not be subject to avoidance under Section 548 of Title 11
of the United States Code (11 U.S.C. SECTION 101 et seq.) (the
Bankruptcy Code ) or any applicable provisions of any
comparable state law.
2. Obligations Unconditional. Each Guarantor
hereby agrees that its obligations under this Guaranty
shall be unconditional, irrespective of:
(i) the validity, enforceability, avoidance or
subordination of any of the Obligations or any of
the Loan Documents;
(ii) the absence of any attempt by, or on
behalf of, the Administrative Agent, any of the
Issuing Banks, any of the Lenders, the European
Administrative Agent or the Syndication Agent to
collect, or to take any other action to enforce, all
or any part of the Obligations whether from or
against any Borrower, any Guarantor or other
guarantor of the Obligations or any other Person;
(iii) the election of any remedy by, or on
behalf of, the Administrative Agent, any of the
Issuing Banks, any of the Lenders, the European
Administrative Agent or the Syndication Agent with
respect to all or any part of the Obligations;
(iv) the waiver, consent, extension,
forbearance or granting of any indulgence by, or on
behalf of, the Administrative Agent, any of the
Issuing Banks, any of the Lenders, the European
Administrative Agent or the Syndication Agent with
respect to any provision of any of the Loan
Documents;
(v) the failure of the Administrative Agent,
any of the Issuing Banks, any of the Lenders, the
European Administrative Agent or the Syndication
Agent to take any steps to perfect and maintain its
security interest in, or to preserve its rights to,
any security or collateral for the Obligations;
(vi) the election by, or on behalf of, the
Administrative Agent, any of the Issuing Banks, any
of the Lenders, the European Administrative Agent or
the Syndication Agent, in any proceeding instituted
under Chapter 11 of Bankruptcy Code, of the
application of Section 1111(b)(2) of the Bankruptcy
Code;
(vii) any borrowing or grant of a security
interest by any Borrower, as debtor-in-possession,
under Section 364 of the Bankruptcy Code;
(viii) the disallowance, under Section 502 of
the Bankruptcy Code, of all or any portion of the
claims against any Borrower of any of the Lenders,
any of the Issuing Banks, the Administrative Agent,
the European Administrative Agent or the Syndication
Agent for repayment of all or any part of the
Obligations or any Expenses; or
(ix) any other circumstance which might
otherwise constitute a legal or equitable discharge
or defense of any Borrower or any Guarantor.
3. Enforcement; Application of Payments.
Subject to Section 1(ii) hereof and the provisions of the
Credit Agreement, upon the occurrence and during the
continuation of an Event of Default, the Administrative
Agent, the Issuing Banks, the Lenders, the European
Administrative Agent and/or the Syndication Agent may
proceed directly against any Guarantor to collect and
recover the full amount, or any portion, of the
Obligations, without first proceeding against any
Borrower or any other Person, or against any security or
collateral for the Obligations. Subject only to the
terms and provisions of the Credit Agreement, the Lenders
and the Issuing Banks shall have the exclusive right to
determine the application of payments and credits, if
any, from any Guarantor, any Borrower or from any other
Person on account of the Obligations or any other
liability of the Guarantors to the Administrative Agent,
any of the Issuing Banks, any of the Lenders, the
European Administrative Agent or the Syndication Agent.
4. Waivers. (i) Each Guarantor hereby waives
diligence, presentment, demand of payment, filing of
claims with a court in the event of receivership or
bankruptcy of any Borrower, protest or notice with
respect to the Obligations, all setoffs and
counterclaims, demands for performance, notices of
nonperformance, notices of protest, notices of dishonor
and notices of acceptance of this Guaranty, and all other
demands whatsoever (and shall not require that the same
be made on any Borrower as a condition precedent to such
Guarantor's obligations hereunder), and covenants that
this Guaranty will not be discharged, except by complete
payment (in cash) and performance of the Obligations and
any other obligations contained herein. Each Guarantor
further waives all notices of the existence, creation or
incurring of new or additional Indebtedness, arising
either from additional loans extended to any Borrower or
otherwise, and also waives all notices that the principal
amount, or any portion thereof, and/or any interest on
any instrument or document evidencing all or any part of
the Obligations is due, notices of any and all
proceedings to collect from the maker, any endorser or
any other guarantor of all or any part of the
Obligations, or from any other Person, and, to the extent
permitted by law, notices of exchange, sale, surrender or
other handling of any security or collateral given to the
Administrative Agent, any of the Issuing Banks, any of
the Lenders, the European Administrative Agent or the
Syndication Agent to secure payment of all or any part of
the Obligations.
(ii) The Administrative Agent, the Issuing
Banks, the Lenders, the European Administrative Agent
and/or the Syndication Agent are hereby authorized,
without notice or demand and without affecting the
liability of the Guarantors hereunder, from time to time,
(a) to renew, extend, accelerate or otherwise change the
time for payment of, or other terms relating to, all or
any part of the Obligations, or to otherwise modify,
amend or change the terms of any of the Loan Documents;
(b) to accept partial payments on all or any part of the
Obligations; (c) to take and hold security or collateral
for the payment of all or any part of the Obligations,
this Guaranty, or any other guaranties of all or any part
of the Obligations or other liabilities of any of the
Borrowers, (d) to exchange, enforce, waive and release
any such security or collateral; (e) to apply such
security or collateral and direct the order or manner of
sale thereof as in its discretion it may determine;
(f) to settle, release, exchange, enforce, waive,
compromise or collect or otherwise liquidate all or any
part of the Obligations, this Guaranty, any other
guaranty of all or any part of the Obligations, and any
security or collateral for the Obligations or for any
such guaranty. Any of the foregoing may be done in any
manner, without affecting or impairing the obligations of
the Guarantors hereunder.
5. Setoff. At any time after all or any part
of the Obligations have become due and payable (by
acceleration or otherwise), the Lenders and the Issuing
Banks may, without notice to any Guarantor and regardless
of the acceptance of any security or collateral for the
payment hereof, appropriate and apply toward the payment
of all or any part of the Obligations (i) any
Indebtedness due or to become due from the Lenders or the
Issuing Banks to such Guarantor, and (ii) any moneys,
credits or other property belonging to such Guarantor, at
any time held by or coming into the possession of the
Lenders or the Issuing Banks or their respective
affiliates.
6. Financial Information. Each Guarantor
hereby assumes responsibility for keeping itself informed
of the financial condition of the Borrowers and any and
all other Guarantors and endorsers and/or other
guarantors of all or any part of the Obligations, and of
all other circumstances bearing upon the risk of
nonpayment of the Obligations, or any part thereof, that
diligent inquiry would reveal, and such Guarantor hereby
agrees that the Administrative Agent, the Issuing Banks,
the Lenders, the European Administrative Agent and the
Syndication Agent shall have no duty to advise any
Guarantor of information known to it regarding such
condition or any such circumstances. In the event that
the Administrative Agent, any of the Issuing Banks, any
of the Lenders, the European Administrative Agent or the
Syndication Agent, in its sole discretion, undertakes at
any time or from time to time to provide any such
information to any Guarantor, the Administrative Agent,
such Issuing Bank, such Lender, the European
Administrative Agent or the Syndication Agent shall be
under no obligation (i) to undertake any investigation
not a part of its regular business routine, (ii) to
disclose any information which the Administrative Agent,
such Issuing Bank, such Lender, the European
Administrative Agent or the Syndication Agent, pursuant
to accepted or reasonable commercial finance or banking
practices, wishes to maintain confidential or (iii) to
make any other or future disclosures of such information
or any other information to such Guarantor.
7. No Marshalling; Reinstatement. Each
Guarantor consents and agrees that none of the
Administrative Agent, any of the Issuing Banks, any of
the Lenders, the European Administrative Agent, the
Syndication Agent or any Person acting for or on behalf
of the Administrative Agent shall be under any obligation
to marshall any assets in favor of any Guarantor or
against or in payment of any or all of the Obligations.
Each Guarantor further agrees that, to the extent that
any Borrower, any Guarantor or any other guarantor of all
or any part of the Obligations makes a payment or
payments to the Administrative Agent or the Lenders or
the Issuing Banks or the European Administrative Agent or
the Syndication Agent, or the Administrative Agent or any
Lender or Issuing Bank or the European Administrative
Agent or the Syndication Agent receives any proceeds of
Collateral, which payment or payments or any part thereof
are subsequently invalidated, declared to be fraudulent
or preferential, set aside and/or required to be repaid
to any Borrower, any Guarantor, such other guarantor or
any other Person, or their respective estates, trustees,
receivers or any other party, including, without
limitation, such Guarantor, under any bankruptcy law,
state or federal law, common law or equitable cause,
then, to the extent of such payment or repayment, the
part of the Obligations which has been paid, reduced or
satisfied by such amount shall be reinstated and
continued in full force and effect as of the time
immediately preceding such initial payment, reduction or
satisfaction.
8. Subrogation. Until the Obligations shall
have been paid in full, each Guarantor hereby agrees that
it (i) shall not exercise any right of subrogation with
respect to such Obligations (under contract, Section 509
of the Bankruptcy Code or otherwise) or any other right
of indemnity, reimbursement or contribution, (ii) waives
any right to enforce any remedy which the Administrative
Agent, any of the Lenders, any of the Issuing Banks, the
European Administrative Agent or the Syndication Agent
now have or may hereafter have against any Borrower, any
endorser or any other guarantor of all or any part of the
Obligations or any other Person, and (iii) waives any
benefit of, and any right to participate in, any security
or collateral given to the Administrative Agent, the
Lenders, the Issuing Banks, the European Administrative
Agent and the Syndication Agent to secure the payment or
performance of all or any part of the Obligations or any
other liability of any Borrower to the Administrative
Agent, the Lenders, the Issuing Banks, the European
Administrative Agent and the Syndication Agent.
9. Subordination. Each Guarantor agrees that
any and all claims of such Guarantor against any
Borrower, any other Guarantor or any endorser or other
guarantor of all or any part of the Obligations, or
against any of their respective properties, with respect
to any Indebtedness of such Borrower to the Guarantor
(the Borrower Indebtedness ), shall be subordinated to
the payment in full in cash of all Guaranteed
Obligations. Notwithstanding any right of the Guarantor
to ask, demand, sue for, take or receive any payment from
any Foreign Borrower, all such rights and Liens of the
Guarantor with respect to the Borrower Indebtedness,
whether now or hereafter arising and howsoever existing
shall be and hereby are subordinated to the rights of the
U.S. Administrative Agent, the Issuing Banks, the
Lenders, the European Administrative Agent and the
Syndication Agent to receive payment in full in cash of
the Guaranteed Obligations. So long as no Event of
Default set forth in Section 11.01(a), (f) or (g) of the
Credit Agreement shall have occurred and is continuing,
the Guarantor shall retain all its rights and shall be
entitled to receive and retain any and all payments made
in respect of, the Borrower Indebtedness. After an Event
of Default set forth in Section 11.01(a), (f) or (g) of
the Credit Agreement shall have occurred and is
continuing, the Guarantor shall not exercise any rights
with respect to the Borrower Indebtedness or to foreclose
upon any asset securing the Borrower Indebtedness,
whether by judicial action or otherwise, unless and until
all of the Guaranteed Obligations shall have been fully
paid in cash and all financing arrangements pursuant to
the Credit Agreement between the Borrowers and the
Lenders and the Issuing Banks have been terminated. If
all or any part of the assets of any Borrower, or the
proceeds thereof, are subject to any distribution,
division or application to the creditors of such
Borrower, whether partial or complete, voluntary or
involuntary, and whether by reason of liquidation,
bankruptcy, arrangement, receivership, assignment for the
benefit of creditors or any other action or proceeding,
or if the business of any Borrower is dissolved or if
substantially all of the assets of any Borrower are sold,
then, and in any such event, any payment or distribution
of any kind or character, either in cash, securities or
other property, which shall be payable or deliverable
upon or with respect to any Borrower Indebtedness shall
be paid or delivered directly to the Lenders and the
Issuing Banks for application to any of the Guaranteed
Obligations, due or to become due, until such Guaranteed
Obligations shall have first been fully paid in cash and
satisfied. The Guarantor irrevocably authorizes and
empowers the U.S. Administrative Agent and each of the
Lenders and each of the Issuing Banks, the European
Administrative Agent and the Syndication Agent to demand,
sue for, collect and receive every such payment or
distribution and give acquittance therefor and to make
and present for and on behalf of the Guarantor such
proofs of claim and take such other action, in the U.S.
Administrative Agent's or such Lender's or Issuing Bank's
or the European Administrative Agent s or the Syndication
Agent s own name or in the name of the Guarantor or
otherwise, as the U.S. Administrative Agent or any Lender
or Issuing Bank or the European Administrative Agent or
the Syndication Agent may deem necessary or advisable for
the enforcement of this Guaranty. Each Lender and each
Issuing Bank may vote such proofs of claim in any such
proceeding, receive and collect any and all dividends or
other payments or disbursements made thereon in whatever
form the same may be paid or issued and apply the same on
account of any of the Guaranteed Obligations. Should any
payment, distribution, security or instrument or proceeds
thereof be received by the Guarantor upon or with respect
to the Borrower Indebtedness after an Event of Default
set forth in Section 11.01(a), (f) or (g) of the Credit
Agreement shall have occurred and is continuing, and
prior to the payment in full in cash of all Guaranteed
Obligations and the termination of all financing
arrangements pursuant to the Credit Agreement between the
Borrowers and the Lenders and the Issuing Banks, the
Guarantor shall receive and hold the same in trust, as
trustee, for the benefit of the U.S. Administrative
Agent, the Issuing Banks, the Lenders, the European
Administrative Agent and the Syndication Agent and shall
forthwith deliver the same to the U.S. Administrative
Agent, in precisely the form received (except for the
endorsement or assignment of the Guarantor where
necessary), for application to any of the Guaranteed
Obligations, due or not due, and, until so delivered, the
same shall be held in trust by the Guarantor as the
property of the U.S. Administrative Agent, the Issuing
Banks, the Lenders, the European Administrative Agent and
the Syndication Agent; provided, that if the Guarantor
fails to make any such endorsement or assignment to the
U.S. Administrative Agent, the Issuing Banks, the
Lenders, the European Administrative Agent or the
Syndication Agent, the U.S. Administrative Agent, the
Issuing Banks, the Lenders, the European Administrative
Agent or the Syndication Agent or any of its officers or
employees are hereby irrevocably authorized to make the
same. The Guarantor agrees that after an Event of
Default set forth in Section 11.01(a), (f) or (g) of the
Credit Agreement shall have occurred and is continuing,
and until the Guaranteed Obligations have been paid in
full (in cash) and satisfied and all financing
arrangements pursuant to the Credit Agreement between the
Borrowers and the Lenders and the Issuing Banks have been
terminated, the Guarantor will not assign or transfer to
any Person any claim the Guarantor has or may have
against any Borrower.
10. Enforcement; Amendments; Waivers. No
delay on the part of the Administrative Agent, any of the
Issuing Banks, any of the Lenders, the European
Administrative Agent or the Syndication Agent in the
exercise of any right or remedy arising under this
Guaranty, the Credit Agreement, any of the other Loan
Documents or otherwise with respect to all or any part of
the Obligations, the Collateral or any other guaranty of
or security for all or any part of the Obligations shall
operate as a waiver thereof, and no single or partial
exercise by the Administrative Agent, any of the Issuing
Banks, any of the Lenders, the European Administrative
Agent or the Syndication Agent of any such right or
remedy shall preclude any further exercise thereof. No
modification or waiver of any of the provisions of this
Guaranty shall be binding upon the Administrative Agent,
any of the Issuing Banks, any of the Lenders, the
European Administrative Agent or the Syndication Agent,
except as expressly set forth in a writing duly signed
and delivered by the Administrative Agent. Failure by
the Administrative Agent, any of the Issuing Banks, any
of the Lenders, the European Administrative Agent or the
Syndication Agent at any time or times hereafter to
require strict performance by any Borrower, any
Guarantor, any other guarantor of all or any part of the
Obligations or any other Person of any of the provisions,
warranties, terms and conditions contained in any of the
Loan Documents now or at any time or times hereafter
executed by such Persons and delivered to the
Administrative Agent, any of the Issuing Banks, any of
the Lenders, the European Administrative Agent or the
Syndication Agent shall not waive, affect or diminish any
right of the Administrative Agent, any of the Issuing
Banks, any of the Lenders, the European Administrative
Agent or the Syndication Agent at any time or times
hereafter to demand strict performance thereof and such
right shall not be deemed to have been waived by any act
or knowledge of the Administrative Agent, any of the
Issuing Banks, any of the Lenders, the European
Administrative Agent or the Syndication Agent, or its
agents, officers or employees, unless such waiver is
contained in an instrument in writing, directed and
delivered to the Borrowers or the Guarantors, as
applicable, specifying such waiver, and is signed by the
Administrative Agent. No waiver of any Event of Default
by the Lenders shall operate as a waiver of any other
Event of Default or the same Event of Default on a future
occasion, and no action by the Administrative Agent, any
of the Issuing Banks, any of the Lenders, the European
Administrative Agent or the Syndication Agent permitted
hereunder shall in any way affect or impair the
Administrative Agent's, any Issuing Bank's, any Lender's,
the European Administrative Agent s or the Syndication
Agent s rights and remedies or the obligations of the
Guarantors under this Guaranty. Any determination by a
court of competent jurisdiction of the amount of any
principal and/or interest owing by any Borrower to the
Administrative Agent, the Lenders, the Issuing Banks, the
European Administrative Agent and the Syndication Agent
shall be conclusive and binding on each Guarantor
irrespective of whether such Guarantor was a party to the
suit or action in which such determination was made.
11. Effectiveness; Termination. This Guaranty
shall become effective against any Guarantor upon its
execution by such Guarantor and shall continue in full
force and effect and may not be terminated or otherwise
revoked until the Obligations (other than indemnities not
yet due) shall have been fully paid (in cash) and
discharged and the Credit Agreement and the Revolving
Credit Commitments shall have been terminated. If,
notwithstanding the foregoing, any Guarantor shall have
any right under applicable law to terminate or revoke its
obligations under this Guaranty, such Guarantor agrees
that such termination or revocation shall not be
effective until a written notice of such revocation or
termination, specifically referring hereto, signed by
such Guarantor, is actually received by the
Administrative Agent. Such notice shall not affect the
right and power of the Administrative Agent, any of the
Issuing Banks, any of the Lenders, the European
Administrative Agent or the Syndication Agent to enforce
rights arising prior to receipt thereof by the
Administrative Agent, the Issuing Banks, the Lenders, the
European Administrative Agent and the Syndication Agent.
If any of the Lenders or Issuing Banks grants loans or
takes other action after such Guarantor terminates or
revokes its obligations under this Guaranty but before
such Lender or Issuing Bank receives such written notice,
the rights of such Lender or such Issuing Bank with
respect thereto shall be the same as if such termination
or revocation had not occurred.
12. Successors and Assigns. This Guaranty
shall be binding upon the parties hereto and their
respective successors and permitted assigns, and shall
inure to the benefit of the parties hereto and the
successors and permitted assigns of the Administrative
Agent, the Lenders, the Issuing Banks, the European
Administrative Agent and the Syndication Agent. The
rights hereunder and the interest herein of each
Guarantor may not be assigned without the written consent
of the Requisite Lenders. Any attempted assignment
without such written consent shall be void. Nothing set
forth herein or in any other Loan Document is intended or
shall be construed to give any other Person any right,
remedy or claim under, to or in respect of this Guaranty.
Each Guarantor's successors shall include, without
limitation, a receiver, trustee or debtor-in-possession
of or for such Guarantor.
13. GOVERNING LAW. THIS GUARANTY SHALL BE
CONSTRUED AND THE RIGHTS AND DUTIES OF THE PARTIES HERETO
SHALL BE DETERMINED IN ACCORDANCE WITH THE LAW OF THE
STATE OF NEW YORK.
14. CERTAIN CONSENTS AND WAIVERS.
(A) PERSONAL JURISDICTION. TO THE FULLEST
EXTENT PERMITTED BY APPLICABLE LAW, (I) EACH OF THE
ADMINISTRATIVE AGENT AND THE GUARANTORS IRREVOCABLY AND
UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS PROPERTY, TO
THE NONEXCLUSIVE JURISDICTION OF ANY NEW YORK STATE COURT
OR FEDERAL COURT SITTING IN NEW YORK, NEW YORK, AND ANY
COURT HAVING JURISDICTION OVER APPEALS OF MATTERS HEARD
IN SUCH COURTS, IN ANY ACTION OR PROCEEDING ARISING OUT
OF, CONNECTED WITH, RELATED TO OR INCIDENTAL TO THE
RELATIONSHIP ESTABLISHED AMONG THEM IN CONNECTION WITH
THIS AGREEMENT, WHETHER ARISING IN CONTRACT, TORT, EQUITY
OR OTHERWISE, OR FOR RECOGNITION OR ENFORCEMENT OF ANY
JUDGMENT RELATED HERETO, AND EACH OF THE PARTIES HERETO
IRREVOCABLY AND UNCONDITIONALLY AGREES THAT ALL CLAIMS IN
RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD AND
DETERMINED IN SUCH STATE COURT OR IN SUCH FEDERAL COURT.
EACH OF THE GUARANTORS IRREVOCABLY DESIGNATES AND
APPOINTS CT CORPORATION SYSTEMS AT 1633 BROADWAY, NEW
YORK, NEW YORK 10019, AS ITS RESPECTIVE PROCESS AGENT
(THE PROCESS AGENT ) FOR SERVICE OF ALL PROCESS IN ANY
SUCH PROCEEDING IN ANY SUCH COURT, SUCH SERVICE BEING
HEREBY ACKNOWLEDGED TO BE EFFECTIVE AND BINDING SERVICE
IN EVERY RESPECT. EACH OF THE ADMINISTRATIVE AGENT AND
THE GUARANTORS AGREES THAT A FINAL NONAPPEALABLE JUDGMENT
IN ANY SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND
MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE
JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW. EACH OF
THE ADMINISTRATIVE AGENT AND THE GUARANTORS WAIVES IN ALL
DISPUTES ANY OBJECTION THAT IT MAY HAVE TO THE LOCATION
OF THE COURT CONSIDERING THE DISPUTE IN ANY SUCH ACTION
OR PROCEEDING IN SUCH STATE COURT OR IN SUCH FEDERAL
COURT.
(II) EACH OF THE GUARANTORS AGREES THAT
THE ADMINISTRATIVE AGENT SHALL HAVE THE RIGHT TO PROCEED
AGAINST EACH OF THE GUARANTORS OR ITS RESPECTIVE PROPERTY
IN A COURT HAVING JURISDICTION IN ANY LOCATION TO ENABLE
THE ADMINISTRATIVE AGENT, THE ISSUING BANKS, THE LENDERS,
THE EUROPEAN ADMINISTRATIVE AGENT AND THE SYNDICATION
AGENT TO REALIZE ON THE COLLATERAL OR ANY OTHER SECURITY
FOR THE OBLIGATIONS, OR TO ENFORCE A JUDGMENT OR OTHER
COURT ORDER ENTERED IN FAVOR OF THE ADMINISTRATIVE AGENT,
ANY ISSUING BANK, ANY LENDER, THE EUROPEAN ADMINISTRATIVE
AGENT OR THE SYNDICATION AGENT. EACH OF THE GUARANTORS
WAIVES ANY OBJECTION THAT IT MAY HAVE TO THE LOCATION OF
THE COURT IN WHICH THE ADMINISTRATIVE AGENT, ANY ISSUING
BANK, ANY LENDER, THE EUROPEAN ADMINISTRATIVE AGENT OR
THE SYNDICATION AGENT MAY COMMENCE A PROCEEDING DESCRIBED
IN THIS SECTION.
(B) SERVICE OF PROCESS. TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW, EACH OF THE GUARANTORS
IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS OF ANY OF
THE AFOREMENTIONED COURTS IN ANY SUCH ACTION OR
PROCEEDING BY THE MAILING OF COPIES THEREOF BY REGISTERED
OR CERTIFIED MAIL, POSTAGE PREPAID, TO THE PROCESS AGENT
OR THE GUARANTOR'S NOTICE ADDRESS SPECIFIED PURSUANT TO
SECTION 16 HEREOF, SUCH SERVICE TO BECOME EFFECTIVE TEN
(10) DAYS AFTER SUCH MAILING. EACH OF THE ADMINISTRATIVE
AGENT AND THE GUARANTORS IRREVOCABLY WAIVES ANY OBJECTION
THAT IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY
SUCH ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT
OR ANY OTHER LOAN DOCUMENT IN ANY JURISDICTION SET FORTH
ABOVE. NOTHING HEREIN SHALL AFFECT THE RIGHT TO SERVE
PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR SHALL
LIMIT THE RIGHT OF THE ADMINISTRATIVE AGENT TO BRING
PROCEEDINGS AGAINST EACH OF THE GUARANTORS IN THE COURTS
OF ANY OTHER JURISDICTION.
(C) WAIVER OF JURY TRIAL. EACH OF THE
ADMINISTRATIVE AGENT AND THE GUARANTORS IRREVOCABLY
WAIVES TRIAL BY JURY IN ANY ACTION OR PROCEEDING WITH
RESPECT TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT TO
WHICH SUCH PERSON IS A PARTY.
15. Waiver of Bond. Each Guarantor waives, to
the extent permitted by law, the posting of any bond
otherwise required of the Administrative Agent in
connection with any judicial process or proceeding to
realize on the Collateral or any other security for the
Obligations, to enforce any judgment or other court order
entered in favor of the Administrative Agent, or to
enforce by specific performance, temporary restraining
order, or preliminary or permanent injunction, this
Guaranty or any other agreement or document between the
Administrative Agent and such Guarantor.
16. Notices. All notices and other
communications required or desired to be served, given or
delivered hereunder shall be in writing or by a
telecommunications device capable of creating a printed
record and shall be addressed to the party to be notified
as follows:
if to any Guarantor, at:
Hexcel Corporation
5794 West Las Positas Boulevard
Pleasanton, California 94588
Attention: Treasurer
with a copy to:
Skadden, Arps, Slate, Meagher & Flom
919 Third Avenue
New York, New York 10022
Attention: Peter J. Neckles, Esq.
Telecopier No.: (212) 735-2000
Confirmation No.: (212) 735-3000
if to the Administrative Agent, at:
Citibank, N.A.
399 Park Avenue
6th Floor, Zone 11
New York, New York 10043
Attention: William Clark
Telecopier No.: (212) 793-7460
Confirmation No.: (212) 559-5944
with a copy to:
Sidley & Austin
875 Third Avenue
New York, New York 10022
Attention: Daniel S. Dokos, Esq.
Telecopier No.: (212) 906-2021
Confirmation No.: (212) 906-2312
or, as to each party, at such other address as designated
by such party in a written notice to the other party.
All such notices and communications shall be deemed to be
validly served, given or delivered (i) ten (10) days
following deposit in the United States mails, with proper
postage prepaid; (ii) upon delivery thereof if delivered
by hand to the party to be notified; (iii) one Business
Day after delivery thereof to a reputable overnight
courier service, with delivery charges prepaid; or (iv)
upon confirmation of receipt thereof if transmitted by a
telecommunications device.
17. Severability. Wherever possible, each
provision of this Guaranty shall be interpreted in such
manner as to be effective and valid under applicable law,
but if any provision of this Guaranty shall be prohibited
by or invalid under such law, such provision shall be
ineffective to the extent of such prohibition or
invalidity without invalidating the remainder of such
provision or the remaining provisions of this Guaranty.
18. Entire Agreement. This Guaranty, together
with the other Loan Documents, embodies the entire
agreement and understanding among the parties hereto with
respect to the matters contained herein and supersedes
all prior agreements and understandings, written and
oral, relating to the subject matter hereof.
19. Execution in Counterparts. This Guaranty
may be executed in any number of counterparts and by
different parties hereto in separate counterparts, each
of which when so executed shall be deemed to be an
original and all of which taken together shall constitute
one and the same agreement.
20. Additional Guarantors. Each of the
Guarantors agrees that, if, pursuant to the Credit
Agreement, the Company shall be required to cause any
Domestic Subsidiary that is not a Guarantor to become a
Guarantor, and such Subsidiary shall execute and deliver
a Subsidiary Guaranty Supplement in the form of Exhibit A
attached hereto, such Subsidiary shall for all purposes
be a party hereto and have the same rights, benefits and
obligations as a Guarantor party hereto on the Closing
Date.
IN WITNESS WHEREOF, this Guaranty has been duly
executed by each Guarantor as of the day and year first
set forth above.
HEXCEL BETA CORPORATION
By____________________________
Name:
Title:
HEXCEL INTERNATIONAL
By____________________________
Name:
Title:
HEXCEL FAR EAST
By____________________________
Name:
Title:
HEXCEL TECHNOLOGIES, INC.
By____________________________
Name:
Title:
Acknowledged and agreed to
as of the __ day of February, 1996.
CITIBANK, N.A., as Administrative Agent
By:
Name:
Title:
EXHIBIT A TO DOMESTIC SUBSIDIARY GUARANTY
SUBSIDIARY GUARANTY SUPPLEMENT
The undersigned hereby agrees to be bound as a
Guarantor for purposes of the Domestic Subsidiary
Guaranty dated as of February 29, 1996, among certain
Subsidiaries of Hexcel Corporation listed on the
signature pages thereof and acknowledged by Citibank,
N.A., as Administrative Agent, and the undersigned hereby
acknowledges receipt of a copy of the Guaranty.
Capitalized terms used herein are used with the meanings
given them in the Guaranty.
Agreed to this ___ day of ______________,
_________.
[NAME OF GUARANTOR]
By:________________________
Name:
Title:
Notice Address:]
EXHIBIT J
TO
CREDIT AGREEMENT
DATED AS OF FEBRUARY 29, 1996
COMPANY PLEDGE AGREEMENT
THIS PLEDGE AGREEMENT (as amended, supplemented
or otherwise modified from time to time, this Pledge
Agreement ), dated as of February 29, 1996, by and
between Hexcel Corporation, a Delaware corporation (with
its successors and permitted assigns, the Pledgor ), and
Citibank, N.A., in its separate capacity as U.S.
administrative agent (with its successors and permitted
assigns in such capacity, the Administrative Agent ) for
the Lenders (as defined below) and the Issuing Banks (as
defined below) party to that certain Credit Agreement
dated as of February 29, 1996 among Hexcel Corporation,
Hexcel S.A. ( Hexcel Belgium ), Hexcel (U.K.) Limited
( Hexcel U.K. ), Composite Materials Limited United
Kingdom ( CML ), Hexcel S.A. ( Hexcel Lyon ) and Brochier
S.A. ( Brochier ; and together with Hexcel Belgium,
Hexcel U.K., CML and Hexcel Lyon, the Foreign
Borrowers ), the institutions from time to time party
thereto as lenders (the Lenders ), the institutions from
time to time party thereto as issuing banks (the Issuing
Banks ), the Administrative Agent, Citibank International
plc, in its separate capacity as European administrative
agent (in such capacity, the European Administrative
Agent ) and Credit Suisse, in its separate capacity as
syndication agent (in such capacity, the Syndication
Agent )(as amended, restated, supplemented or otherwise
modified from time to time, the "Credit Agreement").
Terms defined in the Credit Agreement and not otherwise
defined herein are used herein with the meanings ascribed
thereto in the Credit Agreement.
WITNESSETH:
WHEREAS, the Pledgor is a party to the Credit
Agreement, pursuant to which the Lenders have agreed,
subject to certain conditions precedent, to make loans
and other financial accommodations to the Pledgor and the
Foreign Borrowers from time to time;
WHEREAS, the Pledgor owns (i) the shares of
capital stock described in Exhibit A hereto and issued by
the issuers named therein; and
WHEREAS, in order to secure the prompt and
complete payment, observance and performance of all of
the Obligations of the Pledgor, the Administrative Agent,
the Lenders, the Issuing Banks, the European
Administrative Agent and the Syndication Agent have
required, as a condition, among others, to entering into
the Credit Agreement, that the Pledgor execute and
deliver this Pledge Agreement;
NOW, THEREFORE, for and in consideration of the
foregoing and of any financial accommodations or
extensions of credit (including, without limitation, any
loan or advance by renewal, refinancing or extension of
the agreements described hereinabove or otherwise)
heretofore, now or hereafter made to or for the benefit
of the Pledgor pursuant to the Credit Agreement or any
other agreement, instrument or document executed pursuant
to or in connection therewith, and for other good and
valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the Pledgor and the
Administrative Agent hereby agree as follows:
1. Defined Terms.
(a) Unless otherwise defined herein, each
capitalized term used herein that is defined in the
Credit Agreement shall have the meaning specified for
such term in the Credit Agreement. Unless otherwise
defined herein, all terms defined in Article 8 and
Article 9 of the Uniform Commercial Code in effect as of
the date hereof in the State of New York are used herein
as defined therein.
(b) The words "hereby," "hereof," "herein" and
"hereunder" and words of like import when used in this
Pledge Agreement shall refer to this Pledge Agreement as
a whole and not to any particular provision of this
Pledge Agreement, and section references are to this
Pledge Agreement unless otherwise specified.
(c) All terms defined in this Pledge Agreement
in the singular shall have comparable meanings when used
in the plural, and vice versa, unless otherwise
specified.
2. Pledge. The Pledgor hereby pledges to the
Administrative Agent, for the benefit of the
Administrative Agent, the Lenders, the Issuing Banks, the
European Administrative Agent, the Syndication Agent and
the other Holders and grants to the Administrative Agent
for the benefit of the Administrative Agent, the Lenders,
the Issuing Banks, the European Administrative Agent, the
Syndication Agent and the other Holders, a security
interest in, the following (collectively, the "Pledged
Collateral"):
(a) The shares of the capital stock described
in Exhibit A hereto, and the certificates
representing the shares of such capital stock, all
options and warrants for the purchase of shares of
such capital stock (all of said capital stock,
options and warrants and all capital stock held in
the name of the Pledgor as a result of the exercise
of such options or warrants being hereinafter
collectively referred to as the "Pledged Stock"),
herewith delivered to the Administrative Agent
accompanied by stock powers in the form of Exhibit B
attached hereto and made a part hereof (the "Stock
Powers") duly executed in blank, and all dividends,
cash, instruments and other property from time to
time received, receivable or otherwise distributed
in respect of, or in exchange for, any or all of the
Pledged Stock;
(b) All additional shares of stock of any
issuer of the Pledged Stock from time to time
acquired by the Pledgor in any manner, and all of
the shares of the capital stock issued to the
Pledgor by any other Subsidiary of the Pledgor after
the date hereof that are required to be pledged
pursuant to the Credit Agreement, and the
certificates representing such additional shares
(any such additional shares shall constitute part of
the Pledged Stock and the Administrative Agent is
irrevocably authorized to amend Exhibit A from time
to time to reflect such additional shares), and all
options, warrants, dividends, cash, instruments and
other rights and options from time to time received,
receivable or otherwise distributed in respect of or
in exchange for any or all of such shares;
(c) The property and interests in property
described in Section 4 below; and
(d) All proceeds of the foregoing.
3. Security for Obligations. The Pledged
Collateral secures the prompt payment, performance and
observance of the Obligations.
4. Pledged Collateral Adjustments. If, during
the term of this Pledge Agreement:
(a) Any stock dividend, reclassification,
readjustment or other change is declared or made in
the capital structure of any issuer of Pledged
Stock, or any option included within the Pledged
Collateral is exercised, or both, or
(b) Any subscription warrants or any other
rights or options shall be issued in connection with
the Pledged Collateral, then all new, substituted
and additional shares, warrants, rights, options,
notes or other securities, issued by reason of any
of the foregoing, shall be immediately delivered to
and held by the Administrative Agent under the terms
of this Pledge Agreement and shall constitute
Pledged Collateral hereunder; provided, however,
that nothing contained in this Section 4 shall be
deemed to permit any stock dividend, issuance of
additional stock, warrants, rights or options,
reclassification, readjustment or other change in
the capital structure of any issuer of Pledged Stock
which is prohibited in the Credit Agreement.
5. Subsequent Changes Affecting Pledged
Collateral. The Pledgor represents and warrants that it
has made its own arrangements for keeping informed of
changes or potential changes affecting the Pledged
Collateral (including, but not limited to, rights to
convert, rights to subscribe, payment of dividends,
reorganization or other exchanges, tender offers and
voting rights), and the Pledgor agrees that neither the
Administrative Agent nor any of the Lenders, Issuing
Banks, the European Administrative Agent, the Syndication
Agent or any other Holder shall have any obligation to
inform the Pledgor of any such changes or potential
changes or to take any action or omit to take any action
with respect thereto. The Administrative Agent may, upon
the occurrence and during the continuation of an Event of
Default, without notice and at its option, transfer or
register the Pledged Collateral or any part thereof into
its or its nominee's name with or without any indication
that such Pledged Collateral is subject to the security
interest hereunder. In addition, the Administrative
Agent may at any time, after the occurrence and during
the continuation of an Event of Default, exchange
certificates or instruments representing or evidencing
Pledged Collateral for certificates or instruments of
smaller or larger denominations.
6. Representations and Warranties. The
Pledgor represents and warrants as follows:
(a) The Pledgor is the sole legal and
beneficial owner of the percentage of the issued and
outstanding shares of capital stock of the
respective issuers thereof listed on Exhibit A
hereto, free and clear of any Lien except for the
security interest created by this Pledge Agreement,
and the Pledged Stock constitutes that percentage of
the issued and outstanding shares of capital stock
of the respective issuers thereof set forth in
Exhibit A hereto;
(b) There are no restrictions upon the voting
rights associated with, or upon the transfer of, any
of the Pledged Collateral, other than (i) pursuant
to this Pledge Agreement and (ii) with regard to the
shares of Brochier and Pottsville, such restrictions
as may exist under any applicable Requirement of
Law;
(c) The Pledgor has the right to vote, pledge
and grant a security interest in or otherwise
transfer such Pledged Collateral free of any Liens,
(A) other than pursuant to this Pledge Agreement and
the other Loan Documents and (B) except to the
extent permitted by Section 9.03(ii) of the Credit
Agreement or Section 9.02 (iii) of the Credit
Agreement (with respect to clause (i) of the
definition of Customary Permitted Liens);
(d) The pledge of the Pledged Collateral
pursuant to this Pledge Agreement creates a valid
and perfected first priority security interest in
the Pledged Collateral, in favor of the
Administrative Agent for the benefit of the
Administrative Agent, the Lenders, the Issuing
Banks, the European Administrative Agent, the
Syndication Agent and the other Holders securing the
payment and performance of the Obligations; and
(e) The Stock Powers are duly executed and
give the Administrative Agent the authority they
purport to confer.
7. Voting Rights. During the term of this
Pledge Agreement, and except as provided in this Section
7 below, the Pledgor shall have the right to vote the
Pledged Stock on all corporate questions in a manner not
inconsistent with the terms of this Pledge Agreement, the
Credit Agreement or any other Loan Document. Upon the
occurrence and during the continuation of an Event of
Default, the Administrative Agent may, at the
Administrative Agent's option and following written
notice from the Administrative Agent to the Pledgor,
exercise all voting powers pertaining to the Pledged
Collateral, including the right to take action by
shareholder consent.
8. Dividends and Other Distributions. (a) So
long as no Event of Default shall have occurred and is
continuing:
(i) The Pledgor shall be entitled to receive
and retain any and all dividends and interest paid
in respect of the Pledged Collateral, provided,
however, that any and all
(A) dividends and interest paid or payable
other than in cash with respect to, and
instruments and other property received,
receivable or otherwise distributed with
respect to, or in exchange for, any of the
Pledged Collateral;
(B) dividends and other distributions paid or
payable in cash with respect to any of the
Pledged Collateral on account of a partial or
total liquidation or dissolution or in
connection with a reduction of capital, capital
surplus or paid-in surplus; and
(C) cash paid, payable or otherwise
distributed with respect to principal of, or in
redemption of, or in exchange for, any of the
Pledged Collateral;
shall be Pledged Collateral, and shall be forthwith
delivered to the Administrative Agent to hold, for
the benefit of the Administrative Agent, the
Lenders, the Issuing Banks, the European
Administrative Agent, Syndication Agent and the
other Holders, as Pledged Collateral and shall, if
received by the Pledgor, be received in trust for
the Administrative Agent, for the benefit of the
Administrative Agent, the Lenders, the Issuing
Banks, the European Administrative Agent, the
Syndication Agent and the other Holders, be
segregated from the other property or funds of the
Pledgor, and be delivered immediately to the
Administrative Agent as Pledged Collateral in the
same form as so received (with any necessary
endorsement); and
(ii) The Administrative Agent shall execute
and deliver (or cause to be executed and delivered)
to the Pledgor all such proxies and other
instruments as the Pledgor may reasonably request
for the purpose of enabling the Pledgor to receive
the dividends or interest payments which the Pledgor
is authorized to receive and retain pursuant to
clause (i) above.
(b) Upon the occurrence and during the continuation
of an Event of Default:
(i) All rights of the Pledgor to receive the
dividends and interest payments which it would
otherwise be authorized to receive and retain
pursuant to Section 8(a)(i) hereof shall cease, and
all such rights shall thereupon become vested in the
Administrative Agent, for the benefit of the
Administrative Agent, the Lenders, the Issuing
Banks, the European Administrative Agent, the
Syndication Agent and the other Holders, which shall
thereupon have the sole right to receive and hold as
Pledged Collateral such dividends and interest
payments;
(ii) All dividends and interest payments which
are received by the Pledgor contrary to the
provisions of clause (i) of this Section 8(b) shall
be received in trust for the Administrative Agent,
for the benefit of the Administrative Agent, the
Lenders, the Issuing Banks, the European
Administrative Agent, the Syndication Agent and the
other Holders, shall be segregated from other funds
of the Pledgor and shall be paid over immediately to
the Administrative Agent as Pledged Collateral in
the same form as so received (with any necessary
endorsements);
(iii) The Pledgor shall, upon the request of the
Administrative Agent, at Pledgor's expense, execute
and deliver all such instruments and documents, and
do or cause to be done all such other acts and
things, as may be necessary or, in the opinion of
the Administrative Agent, the Pledgor or its or
their counsel, advisable to register the applicable
Pledged Collateral under the provisions of the
Securities Act, and to exercise its best efforts to
cause the registration statement relating thereto to
become effective and to remain effective for such
period as prospectuses are required by law to be
furnished, and to make all amendments and
supplements thereto and to the related prospectus
which, in the opinion of the Administrative Agent,
the Pledgor or its or their counsel, are necessary
or advisable, all in conformity with the
requirements of the Securities Act and the rules and
regulations of the Securities and Exchange
Commission applicable thereto;
(iv) The Pledgor shall, upon the request of the
Administrative Agent, at Pledgor's expense, use its
best efforts to qualify the Pledged Collateral under
state securities or "Blue Sky" laws and to obtain
all necessary governmental approvals for the sale of
the Pledged Collateral, as requested by the
Administrative Agent;
(v) The Pledgor shall, upon the request of the
Administrative Agent, at the Pledgor's expense, make
available to the holders of its securities, as soon
as practicable, earnings statements which will
satisfy the provisions of Section 11(a) of the
Securities Act; and
(vi) The Pledgor shall, upon the reasonable
request of the Administrative Agent, at the
Pledgor's expense, do or cause to be done all such
other acts and things as may be necessary to make
such sale of the Pledged Collateral or any part
thereof valid and binding and in compliance with
applicable law.
The Pledgor will reimburse the Administrative Agent for
all reasonable expenses incurred by the Administrative
Agent, including, without limitation, reasonable
attorneys' and accountants' fees and expenses in
connection with the foregoing. Upon or at any time after
the occurrence and during the continuation of an Event of
Default, if the Administrative Agent determines that,
prior to any public offering of any securities
constituting part of the Pledged Collateral, such
securities should be registered under the Securities Act
and/or registered or qualified under any other federal or
state law and such registration and/or qualification is
not practicable, then the Pledgor agrees that it will be
commercially reasonable if a private sale, upon at least
ten (10) Business Days' notice to the Pledgor, is
arranged so as to avoid a public offering, even though
the sales price established and/or obtained at such
private sale may be substantially less than prices which
could have been obtained for such security on any market
or exchange or in any other public sale.
9. Transfers and Other Liens. The Pledgor
agrees that it will not (i) sell or otherwise dispose of,
or grant any option with respect to, any of the Pledged
Collateral without the prior written consent of the
Administrative Agent, other than in accordance with the
Credit Agreement, or (ii) create or permit to exist any
Lien upon or with respect to any of the Pledged
Collateral, except for the security interest permitted
hereunder and under the Credit Agreement.
10. Remedies; Application of Proceeds. (a)
The Administrative Agent shall have, in addition to any
other rights given under this Pledge Agreement or by law,
all of the rights and remedies with respect to the
Pledged Collateral of a secured party under the Uniform
Commercial Code as in effect in the State of New York.
In addition, upon the occurrence and during the
continuation of an Event of Default set forth in Section
11.01(a) of the Credit Agreement or upon acceleration of
the Obligations, the Administrative Agent shall have such
powers of sale and other powers as may be conferred by
applicable law. With respect to the Pledged Collateral
or any part thereof which shall then be in or shall
thereafter come into the possession or custody of the
Administrative Agent or which the Administrative Agent
shall otherwise have the ability to transfer under
applicable law, the Administrative Agent may, in its sole
discretion, without notice except as specified below,
after the occurrence and during the continuation of an
Event of Default set forth in Section 11.01(a) of the
Credit Agreement or upon acceleration of the Obligations,
sell or cause the same to be sold at any exchange,
broker's board or at public or private sale, in one or
more sales or lots, at such price as the Administrative
Agent may deem best, for cash or on credit or for future
delivery, without assumption of any credit risk, and the
purchaser of any or all of the Pledged Collateral so sold
shall thereafter own the same, absolutely free from any
claim, encumbrance or right of any kind whatsoever. The
Administrative Agent, any Lender, any Issuing Bank, the
European Administrative Agent and the Syndication Agent
may, in its own name, or in the name of a designee or
nominee, buy such Pledged Collateral at any public sale
and, if permitted by applicable law, buy such Pledged
Collateral at any private sale. In the event of a sale
of any Collateral, or any part thereof, to a Lender, an
Issuing Bank, the European Administrative Agent, the
Syndication Agent or the Administrative Agent upon the
occurrence and during the continuation of an Event of
Default set forth in Section 11.01(a) of the Credit
Agreement or upon acceleration of the Obligations, such
Lender, such Issuing Bank, the European Administrative
Agent, the Syndication Agent or the Administrative Agent,
as the case may be, shall not deduct or offset from any
part of the purchase price to be paid therefor any
indebtedness owing to it by the Pledgor. The Pledgor
will pay to the Administrative Agent all reasonable
expenses (including, without limitation, court costs and
reasonable attorneys' expenses) of, or incidental to, the
enforcement of any of the provisions hereof. The
Administrative Agent agrees to distribute any proceeds of
the sale of the Pledged Collateral in accordance with the
Credit Agreement (including, without limitation, Section
3.02 thereof) and the Pledgor shall remain liable for any
deficiency following the sale of the Pledged Collateral.
(b) Unless any of the Pledged Collateral threatens
to decline speedily in value or is or becomes of a type
sold on a recognized market, the Administrative Agent
will give the Pledgor reasonable notice of the time and
place of any public sale thereof, or of the time after
which any private sale or other intended disposition is
to be made. Any sale of the Pledged Collateral conducted
in conformity with reasonable commercial practices of
banks, commercial finance companies, insurance companies
or other financial institutions disposing of property
similar to the Pledged Collateral shall be deemed to be
commercially reasonable. Notwithstanding any provision
to the contrary contained herein, the Pledgor agrees that
any requirements of reasonable notice shall be met if
such notice is received by the Pledgor as provided in
Section 20 below at least ten (10) Business Days before
the time of the sale or disposition; provided, however,
that the Administrative Agent may give any shorter notice
that is commercially reasonable under the circumstances.
Any other requirement of notice, demand or advertisement
for sale is waived, to the extent permitted by law.
(c) In view of the fact that federal and state
securities laws may impose certain restrictions on the
method by which a sale of the Pledged Collateral may be
effected after the occurrence and during the continuation
of an Event of Default set forth in Section 11.01(a) of
the Credit Agreement or upon acceleration of the
Obligations, the Pledgor agrees that upon the occurrence
and during the continuation of an Event of Default, the
Administrative Agent may, from time to time, attempt to
sell all or any part of the Pledged Collateral by means
of a private placement restricting the bidders and
prospective purchasers to those who are qualified and
will represent and agree that they are purchasing for
investment only and not for distribution. In so doing,
the Administrative Agent may solicit offers to buy the
Pledged Collateral, or any part of it, from a limited
number of investors deemed by the Administrative Agent,
in its reasonable judgment, to be financially responsible
parties who might be interested in purchasing the Pledged
Collateral. If the Administrative Agent solicits such
offers from not less than four (4) such investors, then
the acceptance by the Administrative Agent of the highest
offer obtained therefrom shall be deemed to be a
commercially reasonable method of disposing of such
Pledged Collateral; provided, however, that this Section
does not impose a requirement that the Administrative
Agent solicit offers from four or more investors in order
for the sale to be commercially reasonable.
11. Administrative Agent Appointed
Attorney-in-Fact. The Pledgor hereby appoints the
Administrative Agent its attorney-in-fact, with full
authority, in the name of the Pledgor or otherwise, upon
the occurrence and during the continuation of an Event of
Default, from time to time in the Administrative Agent's
sole discretion, to take any action and to execute any
instrument which the Administrative Agent may deem
necessary or advisable to accomplish the purposes of this
Pledge Agreement, including, without limitation (subject
to Section 8 hereof), to receive, endorse and collect all
instruments made payable to the Pledgor representing any
dividend, interest payment or other distribution in
respect of the Pledged Collateral or any part thereof and
to give full discharge for the same and to arrange for
the transfer of all or any part of the Pledged Collateral
on the books of each of the issuers of such Pledged Stock
or obligors of such Pledged Debt to the name of the
Administrative Agent or the Administrative Agent's
nominee.
12. Waivers. The Pledgor waives presentment
and demand for payment of any of the Obligations, protest
and notice of dishonor or Event of Default with respect
to any of the Obligations and all other notices to which
the Pledgor might otherwise be entitled except as
otherwise expressly provided herein or in the Credit
Agreement.
13. Termination of this Security Agreement;
Release of Collateral.(a) The pledge made and the
security interest granted by the Pledgor under this
Pledge Agreement shall terminate upon final payment in
full in cash of the Obligations and the termination of
the Revolving Credit Commitments under the Credit
Agreement. Upon such termination (other than as a result
of the sale of the Pledged Collateral) and at the written
request of the Pledgor or its successors or assigns, and
at the cost and expense of the Pledgor or its successors
or assigns, the Administrative Agent shall execute in a
timely manner such instruments, documents or agreements
as are necessary or desirable to terminate the
Administrative Agent's security interest in the Pledged
Collateral and deliver the Pledged Stock and the Stock
Powers, subject to any disposition made by the
Administrative Agent pursuant to the Pledge Agreement.
(b) Notwithstanding anything in this Pledge
Agreement to the contrary, the Pledgor may, to the extent
permitted by the Credit Agreement, sell, assign, transfer
or otherwise dispose of any Pledged Collateral. In
addition, the Collateral shall be subject to release from
time to time (with the Collateral referred to in the
immediately preceding sentence, the "Released
Collateral") in accordance with Section 12.09(b) of the
Credit Agreement. The Liens under this Pledge Agreement
shall terminate with respect to the Released Collateral
upon such sale, transfer, assignment, disposition or
release, and, upon the request of the Pledgor, the
Administrative Agent shall execute and deliver such
instruments or documents as may be necessary to release
the Liens granted hereunder; provided, however, that (i)
the Administrative Agent shall not be required to execute
any such documents on terms which, in the Administrative
Agent's opinion, would expose the Administrative Agent to
liability or create any obligation or entail any
consequence other than the release of such Liens without
recourse or warranty, and (ii) such release shall not in
any manner discharge, affect or impair the Obligations or
any Liens on (or obligations of the Pledgor in respect
of) all interests retained by the Pledgor, including
without limitation, the proceeds of any sale, all of
which shall continue to constitute part of the Collateral
unless and until applied strictly in accordance with the
Loan Documents.
14. Successors and Assigns. This Pledge
Agreement shall be binding upon the parties hereto and
their respective successors and permitted assigns, and
shall inure to the benefit of the parties hereto and the
successors and permitted assigns of the Administrative
Agent, the Lenders, the Issuing Banks, the European
Administrative Agent and the Syndication Agent. The
rights hereunder and the interest herein of the Pledgor
may not be assigned without the written consent of the
Requisite Lenders. Any attempted assignment without such
written consent shall be void. Nothing set forth herein
or in any other Loan Document is intended or shall be
construed to give any other Person any right, remedy or
claim under, to or in respect of this Pledge Agreement or
any Pledged Collateral. The Pledgor's successors shall
include, without limitation, a receiver, trustee or
debtor-in-possession of or for the Pledgor.
15. GOVERNING LAW. THIS AGREEMENT SHALL BE
CONSTRUED AND THE RIGHTS AND DUTIES OF THE PARTIES HERETO
SHALL BE DETERMINED IN ACCORDANCE WITH THE LAW OF THE
STATE OF NEW YORK, EXCEPT FOR PERFECTION AND ENFORCEMENT
OF SECURITY INTERESTS AND LIENS IN OTHER JURISDICTIONS
WHICH SHALL BE GOVERNED BY THE LAWS OF THOSE
JURISDICTIONS.
16. Waiver of Bond. The Pledgor waives, to
the extent permitted by law, the posting of any bond
otherwise required of the Administrative Agent in
connection with any judicial process or proceeding to
realize on the Pledged Collateral or any other security
for the Obligations, to enforce any judgment or other
court order entered in favor of the Administrative Agent,
or to enforce by specific performance, temporary
restraining order, or preliminary or permanent
injunction, this Pledge Agreement or any other agreement
or document between the Administrative Agent and the
Pledgor.
17. Severability. Whenever possible, each
provision of this Pledge Agreement shall be interpreted
in such manner as to be effective and valid under
applicable law, but, if any provision of this Pledge
Agreement shall be held to be prohibited or invalid under
applicable law, such provision shall be ineffective only
to the extent of such prohibition or invalidity, without
invalidating the remainder of such provision or the
remaining provisions of this Pledge Agreement.
18. Further Assurances. The Pledgor agrees
that it will cooperate with the Administrative Agent and
will execute and deliver, or cause to be executed and
delivered, all such other stock powers, proxies,
instruments and documents, and will take all such other
actions, including, without limitation, the execution and
filing of financing statements, as the Administrative
Agent may reasonably request from time to time in order
to carry out the provisions and purposes of this Pledge
Agreement.
19. The Administrative Agent's Duty of Care.
The Administrative Agent shall not be liable for any
acts, omissions, errors of judgment or mistakes of fact
or law including, without limitation, acts, omissions,
errors or mistakes with respect to the Pledged
Collateral, except for those arising out of or in
connection with the Administrative Agent's (i) gross
negligence or willful misconduct as determined in a final
non-appealable judgment by a court of competent
jurisdiction, or (ii) failure to use reasonable care with
respect to the safe custody of the Pledged Collateral in
the Administrative Agent's possession. Without limiting
the generality of the foregoing, the Administrative Agent
shall be under no obligation to take any steps necessary
to preserve rights in the Pledged Collateral against any
other parties but may do so at its option. All expenses
incurred in connection therewith shall be for the sole
account of the Pledgor, and shall constitute part of the
Obligations secured hereby.
20. Notices. All notices and other
communications hereunder shall be given in the manner and
to the addresses set forth in Section 13.08 of the Credit
Agreement.
21. Amendments, Waivers and Consents. None of
the terms or provisions of this Pledge Agreement may be
waived, altered, modified or amended, and no consent to
any departure by the Pledgor herefrom shall be effective,
except by or pursuant to an instrument in writing which
(i) is duly executed by the Pledgor and the
Administrative Agent and (ii) is otherwise made in
accordance with the Credit Agreement. Any such waiver
shall be valid only to the extent set forth therein. A
waiver by the Administrative Agent of any right or remedy
under this Pledge Agreement on any one occasion shall not
be construed as a waiver of any right or remedy which the
Administrative Agent would otherwise have on any future
occasion. No failure to exercise or delay in exercising
any right, power or privilege under this Pledge Agreement
on the part of the Administrative Agent shall operate as
a waiver thereof; and no single or partial exercise of
any right, power or privilege under this Pledge Agreement
shall preclude any other or further exercise thereof or
the exercise of any other right, power or privilege.
22. Section Titles. The section titles herein
are for convenience of reference only, and shall not
affect in any way the interpretation of any of the
provisions hereof.
23. Execution in Counterparts. This Pledge
Agreement may be executed in any number of counterparts
and by different parties hereto in separate counterparts,
each of which when so executed shall be deemed to be an
original and all of which taken together shall constitute
one and the same agreement.
24. Entire Agreement. This Agreement,
together with the other Loan Documents, embodies the
entire agreement and understanding of the parties hereto
with respect to the matters contained herein and
supersedes all prior agreements and understandings,
written and oral, relating to the subject matter hereof.
IN WITNESS WHEREOF, the Pledgor and the
Administrative Agent have executed this Pledge Agreement
as of the date set forth above.
HEXCEL CORPORATION
By:________________________
Name:
Title:
CITIBANK, N.A., as Administrative Agent
By:_________________________
Name:
Title:
ACKNOWLEDGMENT
The undersigned hereby acknowledge receipt of a
copy of the foregoing Pledge Agreement, agree promptly to
note on their respective books the security interests
granted under such Pledge Agreement, and waive any rights
or requirement at any time hereafter to receive a copy of
such Pledge Agreement in connection with the registration
of any Pledged Collateral in the name of the
Administrative Agent or its nominee or the exercise of
voting rights by the Administrative Agent.
HEXCEL BETA CORPORATION
By: ___________________________
Name:
Title:
HEXCEL FAR EAST
By: ___________________________
Name:
Title:
HEXCEL INTERNATIONAL
By: ___________________________
Name:
Title:
HEXCEL POTTSVILLE CORPORATION
By: ___________________________
Name:
Title:
EXHIBIT A
to
PLEDGE AGREEMENT
dated as of February 29, 1996
Pledged Stock
Percentage of Shares of Capital
Issued and Outstanding
Stock owned by
Capital Stock owned the Pledgor Subject
Stock Issuer by the Pledgor to Pledge
Hexcel Beta Corporation 100% 3,000
Hexcel Far East 100% 10,000
Hexcel International 100% 100
Hexcel Pottsville Corporation 100% 100
EXHIBIT B
to
PLEDGE AGREEMENT
dated as of February 29, 1996
Form of Stock Power
STOCK POWER
FOR VALUE RECEIVED, the undersigned does hereby
sell, assign and transfer to
_______________________________ ___ Shares of Common
Stock of ______________________ represented by
Certificate[s] No. __ [and __] (the "Stock"), standing in
the name of the undersigned on the books of said
corporation and does hereby irrevocably constitute and
appoint
_______________________________________________________
as the undersigned's true and lawful attorney, for and in
its name and stead, to sell, assign and transfer all or
any of the Stock, and for that purpose to make and
execute all necessary acts of assignment and transfer
thereof; and to substitute one or more persons with like
full power, hereby ratifying and confirming all that said
attorney or substitute or substitutes shall lawfully do
by virtue hereof.
Dated: _______________
HEXCEL CORPORATION
By:_______________________
Name:
Title:
EXHIBIT K
TO
CREDIT AGREEMENT
DATED AS OF FEBRUARY 29, 1996
FORM OF EUROPEAN OVERDRAFT NOTE
[NAME OF FOREIGN BORROWER]
U.S.$ 10,000,000.00 February __, 1996
New York, New York
For value received, the undersigned,
_________________, (the "Borrower"), promises to pay to
the order of Citibank, N.A. (the "European Overdraft
Bank"), in accordance with Section 2.03(d) of the Credit
Agreement, upon the earlier of (A) demand by the European
Overdraft Bank and (B) the Revolving Credit Termination
Date (as defined in the Credit Agreement referred to
below), the lesser of (i) the Dollar Equivalent in the
applicable Optional Currencies in which the European
Overdraft Loans are denominated of a principal amount of
TEN MILLION UNITED STATES DOLLARS (U.S.$ 10,000,000.00)
or (ii) the unpaid principal amount of all amounts loaned
by the European Overdraft Bank to the Borrower under this
Note as European Overdraft Loans under the Credit
Agreement. The principal amount due under this Note,
when aggregated with the principal amount due under all
other Notes issued in accordance with the terms of the
Credit Agreement, will in no case exceed $175,000,000 in
the aggregate.
The Borrower also promises to pay interest on
the unpaid principal amount borrowed hereunder from the
date advanced until paid at the rates (which shall not
exceed the maximum rate permitted by applicable law) and
at the times determined in accordance with the provisions
of that certain Credit Agreement dated as of February 29,
1996 among the Borrower, Hexcel S.A. (Belgium), Hexcel
(U.K.) Limited, Composite Materials Limited United
Kingdom, Hexcel S.A. (Lyon) and Brochier S.A., the
financial institutions from time to time party thereto as
Lenders, the financial institutions from time to time
party thereto as Issuing Banks, Citibank, N.A., in its
capacity as U.S. administrative agent for the Lenders and
the Issuing Banks, Citibank International plc, in its
capacity as European administrative agent for the Lenders
and the Issuing Banks (in such capacity, the "European
Administrative Agent"), and Credit Suisse, in its
capacity as syndication agent for the Lenders and the
Issuing Banks (as amended, restated, supplemented or
otherwise modified from time to time, the "Credit
Agreement").
This Note is issued pursuant to, and is
entitled to the benefits of, the Credit Agreement, which
provides for the incurrence of up to a maximum of
$175,000,000 principal amount of senior secured
Indebtedness and to which reference is hereby made for a
more complete statement of the terms and conditions under
which the European Overdraft Loans evidenced hereby are
made and are to be repaid. Terms defined in the Credit
Agreement and not otherwise defined herein are used
herein with the meanings so defined.
All payments of principal and interest in
respect of this Note shall be made to on the date and at
the place due, to the European Administrative Agent in
the Optional Currencies in which such European Overdraft
Loans were made.
This Note may be prepaid at any time at the
option of the Borrower without premium or penalty, and
must be prepaid as provided in Sections 2.03(d) and
3.01(b) of the Credit Agreement.
This Note shall be governed by, and shall be
construed and enforced in accordance with, the law of the
State of New York.
Upon the occurrence of an Event of Default set
forth in Section 11.01(f) or (g) of the Credit Agreement
as applied to any Borrower (as defined in the Credit
Agreement), the unpaid balance of the principal amount of
this Note may become, and upon the occurrence and
continuation of any one or more of certain other Events
of Default, such unpaid balance may be declared to be,
due and payable in the manner, upon the conditions and
with the effect provided in the Credit Agreement.
The Borrower hereby waives diligence,
presentment, protest, demand and notice of every kind
except as required pursuant to the Credit Agreement.
This Note is secured by certain of the Loan
Documents, and reference is made to such Loan Documents
for the terms and conditions governing the collateral
security for the Obligations of the Borrower hereunder.
IN WITNESS WHEREOF, the Borrower has caused
this Note to be executed and delivered by its duly
authorized officer, as of the day and year and at the
place first above written.
HEXCEL CORPORATION
By____________________
Name:
Title:
EXHIBIT L
TO
CREDIT AGREEMENT
DATED AS OF FEBRUARY 29, 1996
Form of Borrower Addendum
BORROWER ADDENDUM
WHEREAS, [Danutec Holdings AG ( Danutec
Holdings )] [Danutec Werkstoff GmbH ( Danutec
Werkstoff )] is a wholly owned subsidiary of Hexcel
Corporation (the Company ); and
WHEREAS, the Company is a party to that certain
Credit Agreement dated as of February 29, 1996 (as
amended, restated, supplemented or otherwise modified
from time to time, the Credit Agreement ) among the
Company, Hexcel S.A. (Belgium), Hexcel (U.K.) Limited,
Composite Materials Limited United Kingdom, Hexcel S.A.
(Lyon) and Brochier S.A., the institutions from time to
time party thereto as lenders (the Lenders ), the
institutions from time to time party thereto as issuing
banks (the Issuing Banks ), Citibank, N.A., in its
capacity as U.S. administrative agent (in such capacity,
the U.S. Administrative Agent ), Citibank International
plc, in its capacity as European administrative agent (in
such capacity, the European Administrative Agent ), and
Credit Suisse, in its capacity as syndication agent (in
such capacity, the Syndication Agent )(terms defined in
the Credit Agreement and not otherwise defined herein are
used herein with the meanings ascribed thereto in the
Credit Agreement); and
WHEREAS, the Lenders, the Issuing Banks, the
U.S. Administrative Agent, the European Administrative
Agent and the Syndication Agent have required as a
condition, among other conditions set forth in Section
5.03 of the Credit Agreement, to [Danutec
Holdings][Danutec Werkstoff] becoming a Borrower under
the Credit Agreement that [Danutec Holdings][Danutec
Werkstoff] execute this Borrower Addendum;
NOW THEREFORE, [Danutec Holdings][Danutec
Werkstoff] agrees as follows:
1. [Danutec Holdings][Danutec Werkstoff]
hereby acknowledges receipt of the Credit Agreement and
the other Loan Documents.
2. [Danutec Holdings][Danutec Werkstoff]
hereby agrees to be a Foreign Borrower under and as
defined in the Credit Agreement and to be bound by all
the terms and conditions of the Credit Agreement and the
other Loan Documents applicable to a Foreign Borrower.
Agreed to this ___ day of _______, 199_.
[DANUTEC HOLDINGS AG]
[DANUTEC WERKSTOFF GmbH]
By: _______________________
Name:
Title:
EXHIBIT M
TO
CREDIT AGREEMENT
DATED AS OF FEBRUARY 29, 1996
[FORM OF OPINION OF CONNECTICUT COUNSEL TO
THE COMPANY AND ITS DOMESTIC SUBSIDIARIES]
__________, 199_
To the U.S. Administrative Agent, the European
Administrative Agent, each of the Lenders, each of the
Issuing Banks and the Syndication Agent (as each such
term is defined below)
Re: Hexcel Corporation
Ladies and Gentlemen:
We have acted as special counsel to Hexcel
Corporation, a Delaware corporation (the "Company") in
connection with (a) the making of certain loans and other
financial accommodations pursuant to the Credit Agreement
dated as of February 29, 1996 (the "Credit Agreement")
among the Company, certain of its Subsidiaries, the
lenders from time to time party thereto (the "Lender"),
the Issuing Banks from time to time party thereto (the
"Issuing Banks"), Citibank, N.A., in its capacity as U.S.
administrative agent (in such capacity, the "U.S.
Administrative Agent"), Citibank International plc, in
its capacity as European administrative agent (in such
capacity, the "European Administrative Agent"), and
Credit Suisse, in its capacity as syndication agent (in
such capacity, the "Syndication Agent"), and (b) certain
other documents related to the Credit Agreement and the
transactions contemplated thereby.
This opinion is being delivered pursuant to
Section 5.01(a)(i)(A) of the Credit Agreement. Terms
defined in the Credit Agreement or in the list of Closing
Documents attached as Exhibit D to the Credit Agreement
(the "Closing List") and not otherwise defined herein
have the same meanings as are ascribed to them therein.
In connection with rendering this opinion, we
have examined originals or copies, certified or otherwise
identified to our satisfaction, of the following
documents executed by the Company and its Domestic
Subsidiaries (each a "Loan Party"):
(a) the Credit Agreement, including the
Exhibits and Schedules thereto;
(b) the Revolving Credit Notes;
(c) the Swing Loan Note;
(d) the Company Guaranty;
(e) the Domestic Subsidiary Guaranty;
(f) the Company Pledge Agreement; and
(g) the Letter Agreements.
Documents referred to in subparagraphs (a)
through (g) are hereinafter referred to as the
"Agreements".
In addition, we have examined originals or
copies, certified or otherwise identified to our
satisfaction, of such corporate records, agreements,
documents or instruments, as applicable, and of
certificates or comparable documents or instruments of
public officials, and have made such inquiries of such
officers and representatives and such examination of law
as we have deemed relevant and necessary to form the
basis for the opinions hereinafter set forth.
In such examination, we have assumed (i) the
genuineness of all signatures, (ii) the authenticity of
all documents submitted to us as originals and (iii) the
conformity to original documents of all documents
submitted to us as certified or photostatic copies. As
to all questions of fact material to the opinions
specified herein that have not been independently
established, except as specified herein, we have relied
upon certificates or comparable documents of officers and
representatives of the Loan Parties (copies of which have
been delivered to the U.S. Administrative Agent) and upon
the representations and warranties of the Loan Parties
contained in the Credit Agreement.
In rendering the opinions expressed below, we
have assumed, without any independent investigation or
verification of any kind, that each party to the
Agreements has been duly organized and is validly
existing and in good standing under its jurisdiction of
incorporation, and has full power and authority to
execute and deliver the Agreements and perform the
obligations set forth therein, and that the execution,
delivery, and performance of the Agreements by such other
parties have been duly authorized by all requisite
corporate and other action on the part of such other
parties and such documents have been duly executed and
delivered by such other parties. We understand that the
Company will be moving its chief executive office to the
State of Connecticut (the "State") shortly after the
Closing Date and have assumed, for purposes of this
opinion, that the Company is headquartered in the State.
Based on the foregoing, and subject to the
qualifications and assumptions stated herein, we are of
the opinion that:
1. The execution and delivery by each Loan
Party of each Agreement to which it is a party, the
performance by each Loan Party of each Agreement to which
it is a party, the Borrowings by the Borrowers under the
Credit Agreement and the creation by the Loan Parties of
all Liens provided for in the Agreements, do not and will
not contravene any of the terms, conditions or provisions
of any Connecticut Requirement of Law applicable to such
Loan Party or its properties.
2. No consent, approval, waiver, license or
authorization or other action by or filing with any
Governmental Authority is or will be required for (i) the
execution, delivery and performance of any Loan Document
by any Loan Party; (ii) the grant of the Liens
contemplated by the Agreements; or (iii) the perfection
of or the exercise by the U.S. Administrative Agent, the
European Administrative Agent, the Lenders, the Issuing
Banks or the Syndication Agent of their respective rights
or remedies under the Agreements; except for (A) those
already obtained, taken or made, or those that will, in a
timely manner, be made, obtained or given; (B) filings
required to be made after the date hereof pursuant to
state securities, "blue sky" and other similar laws, and
the Internal Revenue Code of 1986, as amended (and the
rules and regulations promulgated thereunder); and (C)
the filing of financing statements.
I. In any action or proceeding arising out of or
relating to the Agreements in any court of the State or
in any federal court sitting in the State, such court
would recognize and give effect to the choice of New York
law in the Agreements, except that the law of the State
would be applied by such court in the event the
application of New York law would offend the public
policy of the State. Nothing, however, in the Agreements
appears to violate the public policy of the State.
Without limiting the generality of the foregoing, a court
of the State or a federal court sitting in the State
would apply to the Agreements the usury law of the State
of New York, and would not apply the usury law of the
State.
The opinions herein are limited to the laws of
the State of Connecticut and we express no opinion on the
effect on the matters covered by this opinion of the laws
of any other jurisdiction.
This opinion is rendered solely for your
benefit in connection with the transaction described
above. This opinion may not be used or relied upon by
any other person and may not be disclosed, quoted, filed
with a governmental agency or otherwise referred to
without our prior written consent, and as otherwise
required by any Governmental Authority or pursuant to
legal process, except that copies of this opinion (i) may
be furnished to and relied upon by assignees and
participants of any of the Lenders, successors to any of
the U.S. Administrative Agent, the European
Administrative Agent, the Lenders, the Issuing Banks and
the Syndication Agent, and by Sidley & Austin in its
capacity as counsel to the Administrative Agent and (ii)
may be furnished to participants of any of the Lenders.
Very truly yours,
